- Safiu Kehinde
Stakeholders at the just concluded one day Annual National Dialogue of the NPO Reports have agreed on the need to expand the population of Nigerians who pay tax.
The stakeholders also concluded that without the support of the citizens, revenue generation and infrastructure development would remain a mirage for a long time.
Speakers at the Annual National Dialogue, the second edition which held in Abuja during the week, brainstormed on the challenges of revenue generation amidst decaying infrastructure.
They lamented that while government needs huge revenues for infrastructure developments, the obstacles to revenue generation are daunting.
Prominent among speakers at the event held at Merit House, Maitama was the Chairman of the Federal Inland Revenue Service (FIRS), Dr. Zacch Adedeji whose keynote address was presented the Director, Intergovernmental Relations, Dr. Umar Idris Ahmed.
Adedeji called for improved tax administration and public-private synergies to increase Nigeria’s revenue generation.
Other speakers included the Governor of Kogi State, Ahmed Ododo, who was represented by his Commissioner for Information, Mr. Kingsley Fanwo; chairman of the event and former Postmaster General of the Federation, Dr. Ismail Adebayo Adewusi; an Associate Professor at the Nigerian Institute of Social and Economic Research, NISER, Ibadan, Dr. Hakeem Tijani; Special Adviser to the President on Economic Matters, Dr. Tope Fasua; Executive Director, Gender Action Initiative, Dr. Mufuliat Fijabi; the CEO of Upshot Media, Mr. Mojeed Jamiu, and others.
The keynote speaker, Adedeji recommended that an improved tax administration will enhance tax collection efficiency, reduce corruption, and increase transparency.
While stressing on the pivotal roles the revenue generation and infrastructural development play in overcoming economic challenges, Adedeji also suggested public-private synergies through the establishment of clear frameworks for Public-Private Partnership (PPP).
“Revenue generation and infrastructural development are pivotal to overcoming the challenges of a constrained economy.
“By adopting the transparent, inclusive and efficient strategies, government can unlock economic potential, foster innovation and improve public services.
“Improve Tax Administration: Enhanced tax collection efficiency, reduce corruption, and increase transparency.
“Enhance Public-Private Synergies: Establish clear frameworks for PPPs and encourage innovative financing to attract private investment in Infrastructure.” He said.
The FIRS chairman also made further recommendations on curbing the nation’s economic constraints among which include, strengthening institutional framework, adoption of digital solutions, and prioritizing strategic projects amongst others.
“Governments should prioritize capacity-building for regulatory bodies to enhance governance and ensure effective policy ‘implementation.
“They should also adopt digital solutions as leveraging technology for revenue collection and infrastructure management can enhance transparency, reduce corruption, and increase efficiency.
“Prioritize Strategic Projects: Focus on high-impact projects that offer maximum economic and social returns, such as transportation, energy, and water supply.
“Foster Inclusivity: Engage stakeholders at all levels to ensure that development initiatives address the needs of all social groups.” Adedeji said.
In his opening address, Adewusi who was also a Commissioner for Finance under the administration of Governor Bola Tinubu in Lagos, called for balance between the ongoing economic reforms and social equity.
He explained that revenue generation and social equity are dependent of each other while calling for the subsidization of essential services, expansion of education and healthcare center, and investment in industrialisation.
“Revenue generation and social equity are two sides of the same coin; one cannot thrive without the other.
“As we push for reforms, we must ensure that revenue generation does not come at the expense of social equity.
“Subsidies should be targeted at essential services like electricity and transportation to shield low-income groups.
“Expanding access to education and healthcare, particularly in underserved regions, is critical for reducing inequality.
“Infrastructure investments must be inclusive, ensuring that rural and marginalized communities benefit alongside urban centers.” Adewusi said.
The former Postmaster General of the Federation lamented on Nigeria’s over-reliance on the oil sector amongst other challenges which he warned threatened the country’s progress despite boasting of $477 billion GDP in 2023.
“Nigeria, Africa’s largest economy, stands at a critical juncture. Despite a GDP of $477 billion in 2023 and immense natural resources, our nation grapples with significant challenges: an over-reliance on oil, a narrow tax base, and glaring infrastructure deficits.
“These issues threaten our progress, but they also present an opportunity – a call to action for all stakeholders to rethink, innovate, and collaborate.” He said.
“Tax Base Limitations: Only 41 million Nigerians are registered taxpayers in a population of over 200 million. This narrow tax base significantly limits the government’s ability to generate sustainable revenue and fund critical infrastructure projects.
“Infrastructure Deficit: Infrastructure challenges are evident in multiple sectors. – Only 60% of Nigerians have access to electricity, a key driver of industrialization and economic growth. – Poor transport networks hinder regional trade, reducing our competitiveness in global markets.” Adewusi explained.
On solutions to the challenges, Adewusi called for the expansion of revenue sources, tax broadening, attracting private investment through Public-Private Partnerships (PPP), and adoption of technology-driven solutions amongst others.
“Broadening our tax base is essential. – We must improve tax compliance by leveraging digital tools and simplifying the tax registration process.
Dr. Tijani of NISER warned against the impact of an increased tax rate on the Nigerian populace, stressing that an increase in tax rate as a means of revenue generation, will lead to an increase in poverty.
“When we are collecting tax, what type of tax are we collecting? I’m not an Economist, I’m a Political Scientist. But I know that there two approaches to generating revenues.
“There is increased tax rate. If you increase tax rate, you may indirectly increase poverty. Already, people are pushed to the wall. If you increase tax rate, you are increasing the poverty of the people.” He said.
Tijani, however, suggested the extension of taxation to other legible firms and individuals.
“An option is that you can increase the tax rate by widening it. I think that is most appropriate.
“Now that we are in this economic downturn, let us widen the tax rate. Let us include those who are not paying. Let them pay instead of increasing the tax rate that can bring more hardship to the people.
“Nigeria is a big market. We are not capitalizing on that largeness, We have very large informal market.
“We can formalize that informal market and ask them to pay more. There are goods. Those goods can be formalized and taxed,” Dr. Tijani.
Another panelist, Jamiu called for correlation between increase in revenue generation and the increase in livelihood of an average Nigerian.
“There should be correlation increase in revenue generation, increase in our external reserves, and the livelihood of an average man on the street.
“It is very important. How can we do this? Improving private enabling environment that can assist us in increasing local productivity is one.
“Yes government have subsidized electricity for those who are in Band B and below. But how many hours of electricity are they getting?
“A man who runs a barber shop for example, if he is not careful, he might not make ends meet if he spends more money in buying fuel to run his business.
“We need to find a way to subsidize these people more so that they can also say that this is my own gain from government.” Mojeed said.
Also in attendance at the NPO Reports Annual Dialogue was Kogi state Governor, Usman Ododo, who was represented by the state’s Commissioner of Information, Hon. Kingsley Femi Fanwo.
Fanwo revealed that Kogi state government had invested N9 billion in agriculture between January to October 2024.
Fanwo disclosed the state government’s plan to work on improving the value-chain which is considered as a very key factor in job creation and enhancing industrialization.
“I strongly disagree with one of the discussants when he was talking about agriculture.
“For us in Kogi, we have to invest very heavily in agriculture. Between January and October this year, Kogi state has invested N9 billion Naira to boost agriculture across the 21 local government area of the state.
“This is also very deliberate. We are also looking at the direction of value-chain improvement. We are the biggest producer of cassava and cashew.
“We cannot just ship out cashew and then buy the product from abroad.
“We are looking at the value chain which is very key.
“With the value-chain, we will be able to create more jobs. We will be able to attract a lot of industrialization into the state and lots of investments.
“And like I said, good infrastructure will be birth more infrastructure. What to do when you improve infrastructure is to create an environment where more people will be able to pay their taxes. This is very crucial and this is one of the things that agricultural value-chain can bestow on our nation.” Fanwo said.
Other dignitaries present at the event include former Ogun state commissioner of information, Alhaji Yusuf Olaniyonu, Vice President/Editor-in-Chief of Leadership Newspapers, Mr. Azu Ishiekwene; Judge of the Sharia Court of Appeal, Justice Abdulahi Adam-Al-Ilori; Justice Kemi Kayode-Ariwoola of FCT High Court, and many others.