Cautious optimism trails tax reform committee’s recommendations

Stakeholders have expressed diverse opinions on the report and recommendations submitted to the President on Tuesday by the presidential committee on tax reform chaired by Taiwo Oyedele.

Though they were unanimous in saying that the details of the report are not known to them, they however agreed that the points raised are things that can help the economy back on its feet if fully implemented.

Professor Godwin Oyedokun of Lead City University, Ibadan, said the recommendations agreed that the work of the Committee so far is a step in the right direction.

According to him, “It is a step in the right direction. It is equally good that the president said they should go and implement, which means there won’t be a problem. I just pray that civil servants will cooperate because people are living on those complexities and those that are feeding from there will fight back to maintain the status quo.

“I saw one of the recommendations that said people should be asked to pay tax between now and December 31 and waive the interest, if there is no money there is nothing you can do about it, so the committee should avoid setting unachievable targets.

“I am also happy they brought up the issue of the CNG. It was very good just like their recommendations on the use of technology for tax.

“But the issue of Taxpro MAX, I don’t think they need presidential approval to make it flexible, FIRS introduced it, and so, it doesn’t need any approval from the president to tweak it in a way that it will be people-friendly.”

Also responding, a former Abuja chapter chairman of Chartered Institute of Taxation of Nigeria (CITN), Benjamin Ogbeide, said though he has not seen the details, he believes the recommendations are things that will help the economy.

According to him, “I have known Oyedele for a long time, I have worked with him, and he is very passionate about tax reforms.”

A council member of CITN, Mrs. Titilayo Fowokan, said the recommendations are low-hanging fruits.

“They are things that the government can easily decide on. That is why the president told them to go and do what it takes to implement it,” She said.

“Those recommendations are things that will allow businesses to breathe within the shortest time. We have measures to address duplication of functions and ensure prudent public financial management. Those are things that the government should have done long before now rather than waiting for this committee.

“On the tax on FX, it is only those transactions that are outside the official market that are to be taxed, I believe that is to discourage round-tripping and black-market transactions,” he stated.

A public analyst, Ndubuisi Ekekwe, observed the submitted report chronicled ways Nigeria can use taxation and other means to fix its economic paralysis.
To him, the two most interesting issues are possible expansion of the official foreign exchange market to incorporate BDCs, forex apps, and retail foreign exchange dealers, and outlaw transactions in the black market.

“Yes, the government will outlaw black market. How do you do that? It may even be illegal to do so (I agree that I know nothing about law),” he stated.

According to him, the second is the imposition of excise tax on foreign exchange transactions outside the official market.

He added: “In other words, make black market more expensive by adding tax components to it. I am not sure how the government will do that as people exchange Naira and US dollars under the mango tree. People willingly pay taxes when taxes are working in their lives. Let us pursue that symbiotic relationship in Nigeria.”