Expert calls for elimination of multiple tax audit system
The government has been urged to work out modalities to harmonise both federal and state government tax audit system, to eliminate multiplicity of processes.
A Partner, Financial Service Industry Group at Deloitte Tax Function, Taiwo Okunade, while addressing stakeholders at the at 6th Triennial Delegates’ Conference organised by the Independent Shareholders’ Association of Nigeria (ISAN), in Lagos, stressed the need for government to harmonise all the agencies involved in tax auditing, and adopt a single audit conduct to alleviate the tax burden of listed firms.
Delivering a lecture titled: “The role of taxation in developing the Nigerian capital market,” Okunade described multiple tax audit and high transaction cost as a disincentive to investment, noting that Nigeria lags behind peers in the ease of paying taxes.
He said: “For the government to encourage investment in the capital market, then transaction cost should be as low as possible. Also, the government can reduce transaction cost by eliminating Value Added Tax (VAT) completely on commission, and fees that an investor will have to pay stockbrokers.
“There is a need for the harmonisation of audit under the umbrella of the Joint Task Force to conduct a single audit instead of different agencies doing different tax audits”
Therefore, he suggested that time was ripe for government to come up with a mechanism for collaboration between the Federal and States government in the areas of effective coordination to reduce audit burden on taxpayers.
The National Coordinator, ISAN, Adeniyi Adebisi, speaking on the theme: “Capital Market as a barometer of a nation’s economy,” noted that implementing policies that will promote national interests rather than personal aggrandisement is key to the growth and development of the capital market as well as the economy.
Adebisi said corporate managers work generally against the background of successive government’s policies, adding that where these policies are good, steady, and well-implemented, managers work better and achieve more.
He said: “We believe that regulators can perform their duties diligently and peacefully without compromising their integrity. But this is not to be. What we find is that regulators are becoming more hostile, aggressive, and overbearing in the way they carry on their jobs.
“Developing the Nigerian capital market and making it more visible in the global market cannot be achieved by mere wishful thinking, consistent affairs will have to be made not only by the NSE, but all the stakeholders including regulators, the Federal government, investors – big or small.”
In the areas of building a strong and vibrant economy, Adebisi decried the huge infrastructure deficit in Nigeria, describing it as one of the major factors stalling economic growth and development of the country.
He pointed out that listed firms, especially the manufacturing sector of the economy would remain underdeveloped, if urgent and drastic actions were not taken to address the nation’s infrastructure.
“It is unfortunate that since the inception of an entity called Nigeria, good governance has been a mirage. A conscious effort to eradicate this fundamental flaw in our system is the right way to go. Deliberate efforts also should be made to build and maintain solid infrastructure.
“I will advocate that government should allow the private sector to lead national infrastructural developments, while it stays back to direct and regulate. I make bold to say that we have huge infrastructural deficits in the country, because government is not opening up infrastructure in Nigeria.”
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