Panelists representing the tax industry at the 25th annual conference of the Chartered Institute of Taxation of Nigeria (CITN), which is currently taking place in Abuja, have recommended that the incoming administration place more emphasis on security, education, and stakeholder engagement than on tax increases.
Speaking on the topic “Stakeholders’ Perspective on Repositioning the African Tax System for Sustainable Revenue Generation: Nigeria as a Case Study,” they offered these proposals.
The panelists include; Killian Khanoba, partner, Pedabo, Esiri Agbeyi, partner, Private Clients and Family Business Leader, PwC Nigeria, Abdallah Ali-Nakyea, senior lecturer, school of Law, University of Ghana, Zainab Gobir, executive director, Nigeria Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), and Lolade Ososami, partner, Udo Udoma & Bello Osagie, who moderated the panel.
Agbeyi stressed the need for tax harmonization, pointing out that there are numerous levies combined together, which increased the cost of conducting business. Gobir anticipates diversity in policy-making.
These circumstances, according to him, hinder the nation’s development in the digital sphere and seriously impair financial inclusion.
Killian urged the next administration to not make the same mistakes that have been made repeatedly and to instead closely examine the factors affecting corporate productivity and job creation in Nigeria.
How do we help small and medium-sized firms grow and hire more workers while also giving them the chance to become larger companies that will ultimately increase tax revenue? asked Killian.
He also highlighted the need to improve security, stressing that people need to feel secure.
According to Killian, Nigerians need to be educated on voluntary tax compliance, “So the more people are educated, the more likely they are to voluntarily pay taxes without any prompting.”
He also urged the government to employ transparency in dealing with Nigerians, who should have the perception that the government is actually working for them.
“People’s perception of democracy, people’s perception of the effectiveness of governance contributes to compliance with tax and contributes to the tax revenue generation,” Killian said.
He also raised the issue of the 54 different types of taxes in Nigeria, which he said contributes only about 18 percent to the country’s revenue.
“And if you look at the contribution to the tax backstage itself, most of these modern noise taxes I call them that. If you put them all together, they contribute just about 18 percent. So why do we have them yet they create the biggest distortion to the smooth operation of businesses in Nigeria,” Killian said.
Finally, the tax professionals highlighted the need to standardize the tax processes across authorities and advised the incoming government to find possible ways to consolidate the country’s taxes, in order to simplify the process of tax compliance and digitalize the tax environment.