L
LequteMan
Guest
Nigeria - President-elect General Muhammadu Buhari can only solve Nigeria’s revenue problems if he places more emphasis on tax collection and reforms as the recent GDP rebasing has shown that the country’s economy is bigger, more diverse, and less dependent on oil and gas than previously thought, a Forbes report says.
The woes in Nigeria’s oil and gas sector (oil price crash, pipe vandalism, mismanagement in the sector, etc) are too complicated and focusing on it is probably a waste of time.
It says Nigeria needs to diversify its revenue sources by increasing revenue collection in the non-petroleum sectors, despite the changes it should make in the oil industry.
“Lower oil prices make the need for tax diversification even more urgent. However, the federal government’stax revenue as a ratio of the revised GDPis among the lowest in the world, averaging a mere 3.2% in contrast to an average 11% among other lower middle income countries and an average 14% for the Sub-Saharan Africa region.
“There is clearly room to increase tax revenue, especially in the non-petroleum sectors. The successful implementation of some of the tax reforms proposed in the 2012 National Tax Policy document could help the government to develop a wider tax base and a more effective tax administration system.
“The proposed changes include creating an electronic nationally integrated database of all taxpayers, replacing income tax with value added tax (VAT) in the non-oil sectors to improve tax compliance, and raising the VAT rate from 5% closer to the 15-18% rate charged by neighboring West African states.
“Realization of these proposals will require a lot of work – investing in human capital and putting in place the needed infrastructure – but the tax revenues would go a long way toward providing economic stability through redistribution, investment in government institutions and fortifying national security.
These changes are necessary for reducing the dependence on oil revenue and generating more revenue for public spending including funding the counter-insurgency effort against Boko Haram in northeast Nigeria, it added.
#Nigeria #Buhari #Forbes
The woes in Nigeria’s oil and gas sector (oil price crash, pipe vandalism, mismanagement in the sector, etc) are too complicated and focusing on it is probably a waste of time.
It says Nigeria needs to diversify its revenue sources by increasing revenue collection in the non-petroleum sectors, despite the changes it should make in the oil industry.
“Lower oil prices make the need for tax diversification even more urgent. However, the federal government’stax revenue as a ratio of the revised GDPis among the lowest in the world, averaging a mere 3.2% in contrast to an average 11% among other lower middle income countries and an average 14% for the Sub-Saharan Africa region.
“There is clearly room to increase tax revenue, especially in the non-petroleum sectors. The successful implementation of some of the tax reforms proposed in the 2012 National Tax Policy document could help the government to develop a wider tax base and a more effective tax administration system.
“The proposed changes include creating an electronic nationally integrated database of all taxpayers, replacing income tax with value added tax (VAT) in the non-oil sectors to improve tax compliance, and raising the VAT rate from 5% closer to the 15-18% rate charged by neighboring West African states.
“Realization of these proposals will require a lot of work – investing in human capital and putting in place the needed infrastructure – but the tax revenues would go a long way toward providing economic stability through redistribution, investment in government institutions and fortifying national security.
These changes are necessary for reducing the dependence on oil revenue and generating more revenue for public spending including funding the counter-insurgency effort against Boko Haram in northeast Nigeria, it added.
#Nigeria #Buhari #Forbes
