The Director-General of MAN, Mr Segun Ajayi-Kadiri, has warned that though it is evident that the government is cash strapped and thus needs more money to push through some of its policies but that it must exercise caution in introducing more taxes.
He was speaking at a virtual event, anchored by the PwC’s Fiscal Policy Partner and Thematic Lead, NESG Fiscal Policy and Planning Thematic Group, Wednesday.
The MAN director general tasked the government to expand the tax base, ensure the inclusion of more people in the informal sector and make the tax system progressive such that the rich would pay more than the poor.
He said, “MAN’s expectation is that, though we need more revenue, the tax system should be structured to take more resources from the rich than the poor. Also, more taxes should be targeted at ostentatious goods and luxury goods. Those who earn more income one way or the other should pay more.
“There is a need for us as a nation to sit at a table and agree that we need to develop a comprehensive and integrated framework that would facilitate the intentional movement of operators in the informal sector to the formal sector and that would make us bring in more revenue for the government through tax.
“Whether we like it or not, huge sums of money in transactions are taking place in the informal sector, and we need to integrate them into the tax system rather than overburden the already compliant companies. If you look at the gamut of taxes levied on companies, they are huge. There are over 12 and additional ones are still coming. There is a need for that framework.
“We need to widen the tax net rather than increasing the burden on existing taxpayers. We need to promote harmonisation of taxes and there is a need for more consultation among stakeholders. Nigeria is at a crossroads but all hands must be on deck, especially looking at Nigeria’s low tax to GDP ratio.”