Vice-President Yemi Osinbajo has said Nigeria has had severe economic downturns, hence the need to widen the tax net so that more people who are eligible to pay tax can pay.
Osinbajo made the call while interacting with a delegation of the Chartered Institute of Taxation of Nigeria (CITN), led by its President, Adesina Adedayo, who visited him at the State House, Abuja.
He said: “We have had severe economic downturns which of course implies that we may not be able to collect taxes with the aggressiveness that would ordinarily be expected. Several efforts have been made including the Voluntary Assets and Income Declaration Scheme (VAIDS), which was also an attempt to bring more people into the tax net, including those who have foreign assets. We have also recently taken a step with respect to a lot of the technology companies that are not represented here but who do huge volumes of business here.”
According to him, the Finance Act has shown the commitment of government to ensure that the big technology companies do not escape without paying their fair share of taxation in Nigeria.
He added that many of the firms do incredible volumes in Nigeria and in several other parts of the region, stressing that: “We have drawn up the regulations and we are prepared to go, and I think that we are at least in a good place to tap into some of the tax resources we can get from some of these companies.”
The vice-president, who pointed out that the federal government has no plans to raise taxes now, however, said there are those who argue that Nigeria’s tax rates are too low, when compared to other places in the region where the rates are much higher.
This, he said, calls for balance because clearly, higher tax rates can be a disincentive to businesses and investments.
He also emphasized the need for regular interaction between the council and government to address issues bordering on tax legislation, adding that there is need for continuous engagement with the National Assembly.
Earlier in his remarks, President of CITN, Adedayo, while commending the efforts of Osinbajo in the implementation of key government interventions in the economy, said the visit became necessary given the enormous work the Buhari administration has done towards addressing the huge fiscal challenges in the polity, public financing reforms and sustained efforts towards addressing infrastructural deficit across the country.
He emphasised that the Nigerian Economic Sustainability Plan (NESP) and other measures implemented was a right response to the challenges posed by COVID-19 pandemic and were largely instrumental to creating buffers for the government at all levels in withstanding the pressures and waves created during the peak period and the aftermath of COVID-19.
The CITN boss also stressed the need to sustain measures already being implemented to improve tax collection at all levels.