Group raises concern over revenue leakages, multiple taxation

*Says ‘government giving away resources meant for national development’

International and national Non-Governmental Organizations, (NGOs), under the auspices of the Tax Justice and Governance Platform, (TJ&GP), have said that the federal government is giving away much-needed financial resources needed for national development in the forms of tax waivers, rebates and pioneer status considerations to organizations that do not need it.

The group made this known at a two-day meeting on tax expenditure and the implication for National development in Abuja.

National coordinator of the Platform, Chinedu Bassey, said tax expenditure plays a very key role in national development but the government is giving away resources that should have been used to provide services, especially in the socio-economic sectors such as education, health and infrastructure for the ordinary citizens to big multinational companies as incentives.

He pointed out that “considering the economic situation of the country right now, we need all the resources to provide these services for the people and we need to amplify our voice on these to reiterate the importance and why the government should have a rethink on this concept and how they are managing for the good of the people.”

Highlighting one of the major challenges Nigeria is facing regarding revenue generation, ActionAid’s Programme Manager, Celestine Odo, said building a national dependable tax database of taxpayers in the country from the state to the national level has continued to be difficult.

According to him, having such a database is essential “so that we will know the number of people paying tax, what they are paying and all that as this will go a long way in boosting the revenue. This will also mean bringing in the high net worth individuals that are supposed to tax such as companies and other big players in the informal sector.

“But going beyond the numbers in terms of compliance, Nigerians are complaining, companies are also complaining that they are providing all the facilities for themselves, yet they are paying tax. What it means is that as the Federal Inland Revenue, (FIRS) is generating income, the government should factor in infrastructure at different levels. It is not all about generating but also utilizing income cause all the economic indices are negative.”

Also, the Project Coordinator of Fiscal Accountability for Inequality Reduction of Oxfam, Nigeria, Henry Ushie, said the myriad challenges bedevilling Nigeria’s tax system ranges from multiple taxations, illicit financial flows and multiplicity of taxes of small business owners among others, especially in the informal sector.

He said some other issues revolve around multinational companies being given incentives in form of pioneer status even after operating for years and this means that the government is giving out money that is dearly needed for development.

He noted that the national budget has been growing leaner over the years, and the implication of this “is that government will not be able to invest appropriately as needed, hence we need to be more deliberate in our revenue generation, we need to be deliberate in allocating these scare resources to the critical sectors and we need to be more deliberate in prioritizing the most vulnerable like women and youth within our space.”

Meanwhile, the Head of Tax Expenditure, Federal Inland Revenue Service, (FIRS), Ikata John, explained that a responsive tax system not only ensures revenue generating needed for infrastructural development but also for the provision of social amenities.

“I appeal to Nigerians, we should not be averse to tax, we should be responsive and we hope the workshop here will provide solutions to some of the challenges. It is assumed that the government is losing revenue through tax incentives but from the tax man’s point of view, the government gives incentives for special reasons and if you do some impact analysis of these incentives which is being seen as some form of loss, you will see that there may be a cardinal developmental curve, he said.