Olisa Agbakoba, a Senior Advocate of Nigeria (SAN), has called on the Federal Government to urgently devolve powers among all three tiers of government in Nigeria to promote efficiency and development.
“As we all know, politically, Nigeria is over-centralised. Everything is decided in Abuja to the great detriment of national development. This reality explains why the Tax Reform bill has run into opposition,” he said in a statement made available to BusinessDay on Monday.
According to him, “The tax reform bill is reform that is long overdue; however, Nigeria’s purported centralised form of governance is standing in the way of the needed reform. The Tax reform bill is good from a revenue point. More money is good especially as the tax reform bill is focused on corporate entities and the upper class super rich.”
He stated further that the bill is a massive incentive to the working class. But the challenge is that the distribution formula is said not to favour Northern Nigeria. According to him, those opposing the tax reform bill may have a reasonably arguable case. “We have always distributed revenue with clear principles. So, the North asks why the revenue sharing formula in the proposed Tax Reform bill is not the same as that for sharing oil revenue.”
He disclosed further that Nigeria will continue to struggle with revenue distribution until the country politically devolves revenue collection to the states, which implies devolution of powers from the centre.
According to him, Northern Nigeria has the capacity to generate massive revenue from mechanization of Agriculture, however, the region does not have the needed incentives to promote such revenue drive on the back of the current sharing formula.
“My honest opinion is that it is more than past time to devolve political and economic power from Federal to state and also from State to local government. This is the only way we will grow the economy from sharing revenue to generating revenue. I strongly believe consumption tax goes to states where the revenue is generated. But the North says that to change the system in the middle of the game is unfair.”
Read also: What Nigeria must do to attain N500trn budget by 2030 – Agbakoba
Agbakoba further said that there is need for careful review of the tax reform. According to him, the FG is involved with too many items like the control of marriage and drivers’ licences or basic education, to the detriment of even distribution of political power.
“When one looks at the 98 items of power, it is plain that we, as a matter of first principles, need to distribute power more evenly and effectively and efficiently across the three arms of government.
“This is also applicable to the Judiciary that is, by far the strongest in terms of Jurisdiction, in the world. The Supreme Court is slow because it exercises far too much local Jurisdiction, best suited at local and state government level.
“I believe the most pressing matter in Nigeria is Governance, relating to redistribution of power across the three levels of Government, so that each level exercises assigned power in the most efficient and effective manner. In this way Revenue Sharing will switch to Revenue generation for development,” he said.
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