‘Enhancing fiscal policies will save economy from external shocks’
Nigeria has been urged to diversify its revenue base to protect its fiscal policies from external shocks.
Experts noted that as the country recently kicked off a 2021-2025 development plan intended to succeed the Vision 2020, and economic recovery growth plan (ERGP), its fiscal sustainability is expected to play a huge role in the new dispensation, given the current economic challenges brought about by the outbreak of the global COVID-19 pandemic.
At a webinar-based meeting organised by the Nigeria Fiscal Policy Roundtable (FPR) of the Nigerian Economic Summit Group (NESG), themed, “Nigeria’s Fiscal Sustainability: Imperatives, Impediments and Options,” NESG Board Chairman, Asue Ighodalo, stressed the need for the country to enhance its fiscal policies for economic growth.
He noted that the nationwide tax survey conducted by the FPR has contributed to the enhancement of the nation’s fiscal processes, just as the Finance Act, creation of a favourable threshold to optimise tax collection, and reduction of the tax burden on the society’s financially-disadvantaged will help to improve the economy and cushion the effects of the taxes.
At the meeting, Chairman of the Nigeria Governors Forum (NGF), Dr. Kayode Fayemi, disclosed that the NGF has set up internally-generated revenue (IGR) dashboard that focuses on sharing knowledge and experiences in tax collection and revenue generation across the states.
He added that “If there is a sustained improvement in IGR, blocking tax leakages, creating new tax sources, and improved efficiency in tax collection, there will be improved socio-economic indices, and citizens will see a direct correlation between tax payments, usage, economic and infrastructural development.”
The Country Director, the Bill & Melinda Gates Foundation, Paulin Basinga, said the value of the FPR is most important at this critical time of the COVID-19 pandemic.
“For Nigeria to accelerate human capital development, there is the need to grow Nigeria’s revenue base. The Bill & Melinda Gates Foundation continues to partner with state and federal governments to strengthen tax administration, social contract, and help in unlocking new revenue sources,” he said.
Special Adviser to President Muhammadu Buhari on Finance and Economy, Dr. Sarah Alade, who represented the Minister for Finance, Zainab Ahmed, said Nigeria is still grappling with low revenue.
She added that the COVID-19 pandemic and the inherent lockdown meant that the GDP would, in its best-case scenario, contract by four per cent, and in the worst-case scenario contract by eight per cent.