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Why Tinubu Govt Should Streamline Taxes, Levies

Why Tinubu Govt Should Streamline Taxes, Levies



The Director General of the World Trade Organisation (WTO), Dr. Ngozi Okonjo-Iweala, has called on the Bola Tinubu-led federal government to streamline its taxes and levies.

Okonjo-Iweala spoke in Abuja at the weekend at a gathering of Women in Leadership Nigeria, which she hosted with the Duchess of Sussex, Meghan Markle.

The former Minister of Finance asserted that though higher taxes and levies might not be bad, they must be streamlined so as not to constitute an undue burden to people.

Okonjo-Iweala added that the government needs to broaden the tax base but should be thoughtful about which taxes and levies it imposes.

She said, “All taxes and levies are to increase government revenue, it depends on where and how you levy it. But our tax to Gross Domestic Product (GDP) ratio is quite low, it is about seven per cent or so of GDP.

“We need to push it up, may be this is why government is introducing some more taxes. But we have to be careful where the levies or the taxes are, so that they don’t constitute an undue burden to people.

“At the same time, we need to bear with the government because the tax-to-GDP ratio is low, and we need to work hard to lift it.

“I don’t want to comment on any specific level but would rather comment on the general, that trying to improve our tax administration and to improve our tax to GDP ratio is something we need to aim at doing.

“To do that we need to broaden the tax base, the base is presently narrow. The number of people that pay tax in the country are not really many. We need to find ways around this but to do it; we need to know that to tax people, you have to offer them service.

“Otherwise, they would wonder why they are paying taxes. So, there is a whole lot of work that we need to do. The government needs to broaden the tax base but they need to be just thoughtful about which taxes and levies they put in.

“I don’t want to comment on any specific level but would rather comment on the general, that trying to improve our tax administration and to improve our tax to GDP ratio is something we need to aim at doing.

“To do that we need to broaden the tax base, the base is presently narrow. The number of people that pay tax in the country is not really many. We need to find ways around this, but to do it, we need to know that to tax people, you have to offer them service.

“Otherwise, they would wonder why they are paying taxes. So, there is a whole lot of work that we need to do. The government needs to broaden the tax base but they need to be just thoughtful about which taxes and levies they put in.”

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