KARL Max had in his dialectics taught that the economy, being the substructure remains that foundation on which the superstructures (law, politics, religion and even culture) stand and are determined. In other words, a good economic idea and its implementation would have its direct influence on other parts of the political system. Nigerians have over the years, suffered from ill prepared shoddy and voodoo economic policies. Hasty, trial and error tax policies had ensured that the cost of doing business and multiple, duplicated taxations have ensured that both the public and private groaned without succour. Added to this is the fact while taxes are being collected, the effect is merely seen in the political system. Government workers, whose income are fixed, are mostly at the receiving end of this tax tyranny.
THE Hope therefore applauds President Bola Ahmed Tinubu’s executive orders, which seek to end the bullying tax regimes in Nigeria. The first executive order, the Finance Act (Effective Date Variation) Order, 2023, defers the implementation of changes outlined in the Act from May 23, 2023, to September 1, 2023; and the Customs, Excise Tariff (Variation) Amendment Order, 2023 which was originally scheduled to take effect from March 27, 2023, is now to be implemented from August 1, 2023; would give ample opportunities and time to sensitise and educate tax payers, and give enough time for entrepreneurs to adjust their operations, finances, and production costs respectively. The postponement of the implementation period for the latter, though short, would still help in arresting the galloping inflation occasioned by the fuel subsidy removal.
FURTHERMORE, the suspension of the 5% Excise Tax on telecommunication services and the newly introduced Green Tax, an Excise Tax on Single Use Plastics; shows that the President is aware that information technology section of the economy represents a core area on which the development of the nation and the employment of the teeming Nigerian youths rests. We therefore hope to see a sporadic growth in the nation’s economy occasioned by high connectivity and access to digital external markets by more Nigerians, and organisations.
BEYOND these policies, what caught our attention is the vision behind them as espoused by the President. According to President Tinubu’s Adviser, on communication and strategy, Dele Alake, “The President wishes to reiterate his commitment to reviewing complaints about multiple taxation, local and anti-business inhibitions. The federal government sees business owners, local and foreign investors as critical engines in its focus on achieving higher GDP growth and appreciable reduction in unemployment rate through job creation”.
THIS position highlights that tax policies as well as other economic policies would not be a run in the mill. Rather, it shall be an outcome of interaction, observation and corrections. Furthermore, Nigerians would also have the opportunity of participating in the economic reveal of this nation through ideas, supports, complaints and innovations. This would ensure economic policies with human face, support, and sustainable delivery”.
WE therefore urge the President Tinubu’s administration to live up to its promise and “the president needs continue to give requisite stimulus by way of friendly policies to allow businesses to flourish in the country.” We insist that there should no further tax raise without robust and wide consultations undertaken within the context of a coherent fiscal policy framework. Once taxes are predictable, fair, and automated, Nigerians would not find it difficult including such in their personal budgets.
HOWEVER, we must warn that collecting taxes without commensurate infrastructural developments to justify those taxes would lead to tax evasion. For the sake of many salary workers, whose taxes are deducted from the source, this administration must revisit the PAYE system of taxation, and also mitigate multiple taxation that crumbles their economic survival and ascendancy.
THE immediate past administration got it wrong by equating increases in GDP with development, thus leading to increased poverty and disillusions. This administration must go beyond increased GDP to enhanced citizens’ empowerment for more productive services, attraction of foreign direct investments, and private sector involvement in the economy. Therefore, while The Hope opines that these time buying reforms are applaudable, a lot more generalized palliatives should still be injected into the political system, so that there can be restoration of human dignity, and zeal to participate in economic governance through profitable entrepreneurial ventures, that would not only strengthen our substructure but also reform our superstructures to ward off parasitic emasculation of our national existence.