Experts project N20tr as Nigerians face more taxation
Stakeholders, yesterday, called for the overhaul of the country’s tax system to plug leakages for Nigeria to save about N20 trillion instead of relying on loans to fund the yearly budgets.
This is even as indication emerged that the Federal Government might tax citizens more to tackle dipping revenues.
While the experts appeal for ways to improve the economy, widen the tax base and deploy technology to check graft, Vice President Yemi Osinbajo, who spoke in Abuja at the 40th anniversary of the Chartered Institute of Taxation of Nigeria (CITN), noted that dwindling oil receipts meant government was to look at the tax sector to improve income.
Nigeria’s oil production has fallen by 30 per cent in the last four years to 1.423 million barrels per day from 2.041 million barrels per day in 2017, as export revenue dropped by 41.44 per cent to $2.033 billion in the first nine months of 2020, compared to the $3.47 billion achieved in the corresponding period of 2019.
This comes at a time when the government is shopping for options, including borrowing to finance the N6.258 trillion deficit in the 2022 budget.
Osinbajo, who was represented by a Permanent Secretary at the Ministry of Finance, Budget and National Planning, Ahmed Rabiu, noted that the tax ratio remains dismal in Nigeria, standing at about eight per cent compared to other countries where it stands at about 16 per cent.
Stressing that there is need for voluntary compliance with tax collection, the Vice President stated that while the country could do better, added that efforts being made in enforcing compliance led to N6.4 trillion revenue in 2021.
“We will continue to offer support by means of policies to ensure the development of the Nigerian tax system to ensure increased revenue performance. Revenue generation has remained the major fiscal constraint of the Federal Government. In this regard, the government remains committed to the implementation of the strategic revenue growth initiative,” he said.
A professional and former President of CITN, Gabriel Fasoto, said N6.4 trillion revenue remains dismal in the face of the huge potential in the country.
President of the institute, Adesina Adedayo, stressed the need for people being taxed to have the capacity to pay.
Also speaking, a Bayero University Kano (BUK) scholar, AB Ahmed, noted that a competitive tax system must not only be about the level of taxation and the policy choices that determine its incidence, but about the quality of tax law and the way the country makes tax policy.