TAX experts have urged state governors to support the Presidential Committee on Fiscal Policy and Tax reforms to halt activities of unofficial state actors who extort taxpayers via ‘touting’.
This was the submission of tax experts who spoke on Monday, April 8, at the weekly ‘Let’s Talk Tax’ programme, organised by the The ICIR in collaboration with the Federal Radio Corporation of Nigeria and support of the International Budget Partnership (IBP).
The last edition’s topic was “Understanding the Tax Payment Mechanism” (where, to whom, and how should you pay your tax?).
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The tax experts posited that if the Presidential Committee on Fiscal Policy and Tax reforms led by Taiwo Oyedele must make the needed headway and succeed in its reforms, the Governor’s Forum must be involved in the reforms.
“The Federal Government needs the states’ support for the reforms to work. Where the majority of the activities of the unofficial state actors are at the sub-national level, there must be buy-in of the state governors,” a tax consultant and member of the Chartered Institute of Taxation, Emeka Okoroeze, said on the programme.
“In most cases, it’s political proxies that the state governors use for tax collections. In most cases, there are cases of multiple taxation and touting, “he added.
He suggested automation of state tax payments, which would be streamlined to guard against unofficial state actors who rip off revenue from the state coffers.
“Automation helps to improve revenue collection systems. The state governors must provide the digital infrastructure to support digital payment systems and have a one-stop shop centre (centralised platform) for their tax collection.”
In his opinion, a tax specialist, Timothy Usman, said states’ Joint Tax Board scheme should take a clue from the Federal Inland Revenue Service and enforce tax-promax digitisation or adopt a similar programme in their states.
He further advocated a ‘tax awareness campaign’ by state officials to sensitise taxpayers on payable taxes.
“Each state should have a tax system that is structured in such a way that taxpayers know whom to pay to at each point without allowing touting especially among rural market businesses.
Notably, the Presidential Committee on Fiscal Policy and Tax Reforms was charged with redefining Nigeria’s tax system and providing practical support to the government in implementing and delivering recommended changes.
The committee has already presented an interim report to President Bola Tinubu, but not much has been heard about it since it submitted the report in February.
Most Nigerians are worried that unofficial state actors are getting the revenue that the state government ought to get because of poor oversight in most states.
Unofficial state actors’ undue interference in Nigeria’s tax system is also disrupting the ease of doing business and dissuading both local and foreign investors while stalling trade facilitation in the country.
The ICIR reported how Rivers State Government lost N55 billion in transport tax to private pockets.
The report noted that a large chunk of the tax went into the accounts of a transport union and its members while touts appropriated part of it.
Harrison Edeh is a journalist with the International Centre for Investigative Reporting, always determined to drive advocacy for good governance through holding public officials and businesses accountable.