States, Experts Seek Transparent Tax System To Boost IGR

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Lagos State Governor Babajide Sanwo-Olu and his counterparts from Sokoto and Borno States have emphasised the need to make the country’s tax system more transparent and accountable to Nigerians to boost confidence and voluntary compliance.

 

The governors spoke at the 26th Annual Tax Conference, organised by the Chartered Institute of Taxation of Nigeria (CITN) in Abuja, with the theme “Sustainable Tax Culture and Economic Roadmap for Nation Building.”

 

Speaking at the conference, Governor Sanwo-Olu, who was represented by his Special Adviser on Taxation and Revenue, Abdul-Kabir Opeyemi Ogungbo, said the theme of the Conference was apt and timely given that Nigeria, like many other nations, is currently facing significant economic challenges.

 

While underscoring the crucial role of a transparent and efficient tax administration in fostering confidence and voluntary compliance among taxpayers, he emphasised the necessity for citizens to witness tangible outcomes from their tax contributions, highlighting the pivotal role taxes play in fueling public services and infrastructural development.

 

Sanwo-Olu stressed the shift in mindset needed, urging taxpayers to view tax payments not as a burden but as an investment in a better future for Nigeria.

 

He said building a solid and sustainable future through a robust tax system that fosters economic growth and development had become inevitable.

 

Sanwo-Olu said, “We must all understand the crucial role taxes play in building a better Nigeria for ourselves and future generations.

 

“The theme also highlights the need for a clear economic roadmap that should take note of the architecture of our developmental ideologies, which are designed to provide the government with the necessary resources to cater to the social needs of its citizens; therefore, we need a tax system that incentivises investment, job creation, and economic diversification.

 

“We must explore innovative ways to expand the tax base while fostering a business environment that allows our economy to thrive. The good news is that Nigeria is already taking positive steps in these directions. The recent efforts to streamline state-level taxes and the focus on integrating the growing remote workforce into the tax net are commendable initiatives.”

 

The governor said, “The CITN plays a vital role in fostering this vital shift. Your commitment to professional excellence and education is instrumental in ensuring a tax system that is fair, efficient, and promotes economic development.”

 

However, former Governor of Ogun State, Senator Ibikunle Amosun, who declared the conference open while stressing the need to prioritise growing Internally Generated Revenue (IGR) over relying solely on borrowing to fund national and sub-national budgets, said borrowing to finance the budgets was not the way to go amid the current national economic challenge when “our nation and its constituent states and local governments are going through tough times and finding it hard to provide for its teeming populace, acceptable standards of living, employment with the growing population of youths, infrastructure and basic amenities that will make life more meaningful”.

 

Governor Babagana Zulum of Borno State criticised inefficiencies and corruption in the current tax administration system and highlighted its shortcomings, including tax evasion, avoidance, and lack of transparency.

 

Zulum, represented by the Deputy Governor of Borno State, Umar Kadafur, called for critical reforms to address these issues, including tackling corruption in both the oil sector and governance system. He criticised the political protection of tax evaders and emphasised the importance of transparency and accountability in tax administration.

 

While calling for critical reforms, he lamented the manipulation and connivance of multinationals with tax administration to short-change the system. He added that this represented one of the hallmarks of corruption in both the oil and governance systems.

 

In his remarks, the Governor of Sokoto State, Ahmad Aliyu Sokoto, said the conference will help explore innovative ways of improving revenue generation in the country.

He said the economic and revenue challenges had made it difficult for governments at all levels to implement their people-oriented programmes, thus requiring the government to devise a means of raising more funds to provide the dividends of democracy to the people.

 

The governor said taxation remained a veritable source of resource mobilisation for the government, adding that his administration would work with CITN to boost IGR in the state.

 

The Auditor-General for the Federation (AuGF), Shaakaa Chira, said the country’s tax system was plagued by instances of tax evasion, especially by the upper class, multiple taxes, and an inability to properly account for taxes collected by administrators.

 

The Chairman of the conference planning committee, Adeyemi Sanni, noted that for Nigeria to achieve meaningful fiscal development over the long term, it is imperative to establish a tax culture that can withstand economic fluctuations and challenges.

Samuel Agbeluyi, president and Chairman of the CITN council, emphasised the importance of investing in technology and people at the subnational level to effectively track revenues in the digital space, including cryptocurrency. He believes this will help maximize government revenue flow.

 

Agbeluyi stressed the need to support revenue authorities through financial and administrative autonomy, empowering them to administer taxes effectively. He noted that a strategic approach to revenue management is crucial for the government’s overall economic health.

 

The CITN boss stated, “This is a thought-provoking topic that requires all of us to put on our thinking hats. As we deliberate, we must recognise that our nation faces significant challenges. Our current economic realities as a country are multifaceted, despite efforts by the current government to improve the narrative.

 

He said, “The 2024 budget of “Renewed Hope” relies significantly on non-oil revenue, and this trend is expected to continue. Therefore, building a sustainable tax culture can significantly improve our tax revenue performance. economic and capital formation becomes a top priority.”