This came amid calls for transparent and judicious use of taxes, at a time the country is wallowing in debt, harsh operating environment for taxpayers and corruption in government.
Speaking at the yearly conference of the Chartered Institute of Taxation of Nigeria, Minister of Finance, Budget and National Planning, Zainab Ahmed, said Nigeria’s low revenue in Gross Domestic Product (GDP) and tax ratio to GDP remains worrisome.
Represented by her assistant, Ahmed Bashir, the minister said effort to bring more businesses into the tax base is sacrosanct. She said there is a need to devise appropriate ways to tax new business models and their profits in a digitised economy.
“We need to critically analyse the economy, tax challenges, and global minimum tax. We need to also rethink the incentives we give and approaches, when granting tax incentives, to strike a balance between stimulating economic growth and generating revenue to fund government businesses,” she said.
President of the institute, Adesina Adebayo, said analysis of the socio-economic environment of Nigeria reveals a fundamental gap between developmental potentials and current realities.
According to him, in the midst of insufficient revenue from crude oil earnings, fluctuating value of the naira, rising debt burden and increasing government expenditure, taxation has become the only “hope of the nation.”
He noted: “However, it is apparent that the country has not effectively harnessed its tax revenue potential. It is also general knowledge that Nigeria’s Tax-to-GDP ratio is considered a serious cause for concern, when compared to others in Africa. Although there are several arguments on the subject, the fact still remains that it is below the average of 35.5 per cent.”
Chairman of the conference, Ruth Arokoyo, said there is a need to strengthen the tax system to deliver sustainable development.
According to her, in the face of dwindling revenue, domestic revenue remains critical to the provision of needed services.
