Streamlining of the tax regime and adoption of technology can help the government motivate businesses to be more tax compliant, finance and tax experts have said.
The experts made the submission at an event tagged “Tax Administration in Nigeria and its Effects on Businesses”, organized by the American Institute of Economic Research’s Bastiat Society of Nigeria in collaboration with Ominira Initiative for Economic Advancement.
The event, held at the University of Ibadan, was put together to facilitate dialogue about the challenges of tax administration in Nigeria, its effects on businesses, and how it could be better for both the government and the citizens.
Bimbo Adekanmbi, a former Oyo State Commissioner of Finance, said that taxes are onerous, and no matter how altruistic the intent is, it decreases the bottom line of businesses.
Mr Adekambi, who was the keynote speaker at the event, added that tax is a predictable and sustainable source of revenue for the government to deliver its obligations to the people.
According to him, the mind-numbing bureaucracy that is obtainable in Nigeria’s tax administration is disturbing.
“When you want to apply for things like tax clearance certificate which should be obtainable in 24 hours or less, but could take as long as three months,” he said.
“To create alternative sources of revenue, the government has turned its focus on agriculture and taxes in recent years, and since then, the government’s revenue from taxes has increased. In 2018, the Federal Inland Revenue Service (FIRS) had the highest collection in history when it hits N5.3 trillion in revenue.”
According to Mr Adekambi, the amount is low compared to what could be realized if the government provides value to taxpayers, adopts technology to streamline the tax processes, and eradicates the mind-numbing bureaucracy for tax clearance certificate issuance, withholding tax, and its entire system
In his submission, Sanmi Abiodun, a corporate lawyer at Audrey Oluwatoni Associates, also talked about the problems of weak compliance to tax payment by SMEs. This, according to him, is because of the multiplicity of taxes and corruption in tax administration.
In addition, lack of confidence in government and tax administration also contributes to why people would rather not pay their taxes, he said.
“When the people know that the government will deliver infrastructure like constant power supply, good roads, and so on, they will find it easier to be tax compliant,” says Mr Abiodun.
Support PREMIUM TIMES' journalism of integrity and credibility
Good journalism costs a lot of money. Yet only good journalism can ensure the possibility of a good society, an accountable democracy, and a transparent government.
For continued free access to the best investigative journalism in the country we ask you to consider making a modest support to this noble endeavour.
By contributing to PREMIUM TIMES, you are helping to sustain a journalism of relevance and ensuring it remains free and available to all.
TEXT AD: To advertise here . Call Willie +2347088095401...