• Tuesday, April 16, 2024
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FG to shrink tax commitments to single-digit

Taiwo Oyedele, chairman of the Presidential Committee on Tax Reforms and Fiscal Policy, has said that they will ensure the number of taxes across all levels of government is consolidated to a single digit, as against countless official and unofficial tax obligations.

He said this Tuesday, at a virtual stakeholder engagement comprising manufacturers, importers, and exporters.

“We’re aiming at a single-digit number of taxes across all levels of government. Today, officially, there are more than 60 different taxes charged, and unofficially, there are more than 200.

“Of course, you’d agree it is ambitious to want to have a single-digit number of taxes because this means no business will even have to pay up to four or five,” Oyedele said.

Read also: Factors that strengthen tax reforms

He added that the committee targets a minimum tax-to-GDP ratio of 18 percent within the next three years. “That will take us to the African average. We think we can do more than that without introducing new taxes,” he said.

According to him, an intelligent tax system that is self-auditing itself will also be developed, to reduce the burden of multiple audits requiring businesses to almost create a department just to attend to regulators for all manners of audits which distract from the businesses that they do, increasing their cost of business and risks, and at the end of the day, turning around to hurt the economy itself.

“Whereas if you create a system that is self-auditing, the system just marks for you, the exceptions, and those are the people to go after rather than going after people who are doing their best to do the right thing.”

He added that the committee is planning to rewrite all the major tax laws so that it will not be amending, but enacting new laws. It also plans to set up the office of Tax Ombudsman to essentially provide government funding.

Dele Oye, national president of the Nigeria Association of Chambers of Commerce, speaking to Oyedele’s presentation, said all savings made should go to investment banks, banks of industries, which are constituted to guarantee their independence so that those monies can be channeled to give single-digit loans to industries.

“You must find a way to fund the industries,” Oye said, adding, “Everywhere in the world, they protect their productive sectors. This is critical, and I think if we don’t do this, there’s no tax to collect with the way the industries are closing down.

Read also: FG eyes new tax reforms, ‘conservative’ oil benchmark

“Most of our members are refusing to open their factories because they don’t even know what to do, they cannot calculate their risks. This is an emergency and something to be addressed very importantly.”