Cases of multiple taxation are rampant in Nigeria.
A tax expert with GEMS3 (Growth and Employment in States), Mark Abuh, on Monday called for the harmonisation of tax laws by all tiers of government in the country to curb the growing incidence of multiple taxation.
Mr. Abuh said in Abuja that GEMS3, a DFID-funded project managed by Adam Smith International, was involved the business environment in Nigeria through tax harmonisation in the various states.
He defined multiple taxation as a situation where the same tax base is taxed more than once by different jurisdictions, adding that this was adversely affecting the country’ economy.
Mr. Abuh called on the Joint Tax Board to intensify efforts to curb the incidence of tax multiplicity which was affecting business as well as the economy. He added that there was the need for the Federal Government to review the existing laws and ensure compliance with the provisions of the constitution on tax matters by all.
“The best way to handle multiple taxation is to review the existing tax laws at all levels to close up loopholes in existing laws,” he said, pointing out that there should be harmonisation of tax laws among all tiers of government to eliminate clearly overlapping collections of same or similar taxes and levies.
He noted that there should also be tax education for both the tax payers and staff of the various tax authorities, which includes publication of approved list of taxes and levies within the states and local governments, adding that this would go a long way to enlighten the public and facilitate compliance.
Abuh identified reduction in output, profit, investment and gross domestic Products, GDP, as harmful effects of multiple taxation to the economy, saying multiple taxation also meant a situation where the same tax base is taxed more than once by different jurisdictions.
“It is a key disincentive to both local and foreign investments; it leads to high cost of business and could eventually lead to divestment of major stakes off an economy. Multiple taxation reduces enterprise output, operating surplus, investment, non-oil export and GDP while inducing inflation and improving government revenue,” he said.
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