70% of Nigerians Ready to Pay Tax —NESG

Evaluation of Public Accountability and Tax Culture among Tax Payers in Nigeria
  • 70% of Nigerians Ready to Pay Tax —NESG

The Nigeria Economic Summit Group has said that about 70 per cent of Nigerians believe that it is not wrong to pay tax.

The NESG disclosed this during its Fiscal Policy Roundtable event in Lagos, while launching its Citizen Perception Report, a research advocating better tax system in the country.

The Fiscal Policy Roundtable co-chair, NESG, Dr Doyin Salami, said the government had been unable to meet recurrent and capital expenditures following a budget deficit of N3.8bn and debt profile of N22.7bn.

While mentioning some findings in the Citizens Perceptions Report, he said that, “Over 70 per cent of Nigerians believed that it is not wrong to pay taxes. This sentiment is fuelled by the issues around the social contract between the government and the citizenry.”

Salami, who was represented by the PWC West Africa Tax Leader and Research Director, NESG Fiscal Policy Roundtable, Mr Taiwo Oyedele said, “Low tax compliance results from tax complexity, crisis of trust in the government and inadequate social contract deliverables; while tax officials were constrained by inconsistent tax policies, limited resources, unrealistic targets, and inability to influence service delivery, among others.”

The NESG noted that its project called, ‘Better Tax’ sought to close knowledge gaps in fiscal policy and create a sustainable framework to actualise the Federal Government’s inclusive economic agenda.

It noted that the report was the product of a nationwide perception survey across households and small businesses in the tax value chain.

In the report, it tasked the government to establish an office of tax simplification among other recommendations targeted at demystifying complex provisions in the nation’s tax laws and boosting dwindling revenues from the non-oil sector of the economy.

The Chairman, NESG Fiscal Policy Roundtable, Dr Sarah Alade, said the core concept of the roundtable was to reflect the needs and objectives that formed the basis of a robust fiscal reform platform, focused on mobilising and growing the country’s tax revenue.

She mentioned that the International Monetary Fund estimated that revenue collected in 2016 across all tiers of government was only about six per cent of the Gross Domestic Product.

Alade added that historically, more than 70 per cent of the revenue had come from the oil sector while the non-oil sectors, which accounted for more than 90 per cent of GDP, had historically contributed about 30 per cent to revenue.

She said, “This limits Nigeria’s ability to credibly execute its development plan and fund critical social sector programmes. It also leaves Nigeria very vulnerable to macro-economic shocks from low oil prices. The most recent fall in oil prices threw Nigeria into a fiscal crisis with spill-over effects on the economy resulting in a recession in 2016.

“Building a strong revenue base that is balanced between the oil and non-oil sector is therefore critical to sustainably financing Nigeria’s development programme and long-term macro-economic stability.”

About the Author

Samed Olukoya
CEO/Founder Investors King Ltd, a foreign exchange research analyst, contributing author on New York-based Talk Markets and Investing.com, with over a decade long experience in the global financial market. Contact Samed on Twitter: @sameolukoya; Email: [email protected]

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