Economists seek tax incentives for entrepreneurs to grow FDI, GDP

Experts have suggested low tax rates for new entrepreneurs that meet specific conditions to facilitate active growth in various sectors of the economy.

Experts who ventilated on this at a conference on economic diversification in Abuja, yesterday, insisted that a regime of a low tax rate for entrepreneurs was one of the factors that could incentivise investors to invest in the country.

Managing Director, Wontes Consult Limited, Olumide Olufemi Ajayi, urged the government to strengthen the tax system for companies with higher output, maintaining that they are expected to pay higher tax rates.

According to him, the high revenue generated from the companies must be used to develop relevant projects.
He added: “The biggest contributors to the nation’s GDP and many fast-growing sectors make the least contributions to government revenue regarding taxes.”

Ajayi further urged the government to appropriately tax economic activities of both formal and informal sectors to help provide critical public services.

“Income inequality can lead to an increased number of citizens that lack the required work skills, thus reducing productivity in the economy. The reduction of social mobility can also be associated with income inequality. The government should look into making education accessible to both the low and middle-class citizens,” he also demanded.

Also speaking, the Executive Director of the Initiative for Leadership and Economic Watch in Nigeria, Splendor Agbonkpolor, disclosed that the conference was put together to generate workable ideas that would diversify the economy as an effective tool to create wider opportunities.

Agbonkpolor said the outcome of the meeting, if implemented, would create jobs and income-earning avenues for low-income earners and the unemployed.