By Fumnaya Ijeh
President of Nigeria, Muhammadu Buhari has proposed improved tax revenue for the country which will not necessarily impose new tax rates on citizens.
According to Buhari, in the face of dwindling revenues, there is an urgent need to maximize domestic revenue within the extant tax policy and laws.
The Nigerian leader was speaking on Tuesday while declaring open the second National Tax Dialogue Week.
He told participants that his administration was committed to an efficient tax administration to improve tax revenue in Nigeria.
He expressed concern about the current tax system in Nigeria, which was characterized by fragmented administration, multiple and sometimes, overlapping taxes.
In his words, ”In most tax-efficient nations, tax administrative processes and practices are harmonized within a single system. One key deliverable of this year’s tax dialogue is to promote synergy in tax feminisation among the different tiers of government.
”Harmonising taxpayer-identification across the country is a good start, but we must do more to promote ease of doing business (including ease of tax compliance) in Nigeria.
”On our part, we have started by clarifying in the 2021 Finance Act that Federal Inland Revenue Service is the sole authority to administer tax for the Federal Government. This clarification became necessary to avoid taxpayers being burdened with multiple tax compliance obligations towards different agencies of the same government.
”Multiplicity of tax administration is as undesirable as the multiplicity of taxes; it creates uncertainty and instability; and above all, it is inefficient,” the President said at the Dialogue themed ”Tax Harmonisation for Enhanced Revenue Generation. “
He continued by saying, “We all know that good intention are not enough as they simply cannot pay for infrastructure, security, or social amenities. We must therefore improve tax revenue without necessarily raising new taxes.
”Revenue from commodities, including crude oil, are too volatile and unreliable. Therefore, I pledge the government’s support for any viable initiative for improving tax revenue that should emanate from this dialogue,’’ he said.
Buoyant Revenue Base
On Nigeria’s Tax-to-GDP ratio, the President declared that the country also needs to do more in securing a buoyant domestic revenue base of the country that bequeaths an enduring economic foundation, political stability, and social harmony to the next generation.
”According to the Organisation of Economic Cooperation and Development (OECD), in its Revenue Statistics in Africa 2021, the average ratio of Tax-to-GDP of 30 selected African countries in 2019 was 16.6% while Nigeria recorded a mere 6.0%.
”It is obvious that much needs to be done in the area of tax revenue mobilization. It is my expectation that the discussions at this 2022 National Tax Dialogue will be focused on what we must do to maximize legitimate revenue collection and massively improve the Tax-to-GDP ratio,” he added.
Awards were presented at the event, to the top 20 Nigerian taxpayers.