Unremitted Taxes/Revenue: The Consequences On Nigerians
Eben Enasco Reporting.
In 1903, Lord Lugard took the first step in centralizing tax by implementing Stamp Duties Proclamation.
Since the proclamation, Nigeria operates a decentralized system in which the various levels of government are responsible for the taxes within their jurisdiction.
They also employ the progressive tax system where an individual with a higher income pays higher taxes
The position of the law is that all adults from the age 18 and above must pay Personal Income Tax except those exempted by the law as stipulated in the Third Schedule of PITA 104 CAP P8 LFN 2004 & Amendment at 2011. 18.
In the smallest of nutshells, taxes are paid because the state or federal governments implement laws.
Therefore, the Nigerian tax system structured as a tool for revenue generation for government to implement policies that will help strengthen the economic system is brought to its knees by a few corrupt elements
Knowing that, before a Country considers how best to administer its tax system, it must possess a clear picture of the scope of the tax system and how best to apply this in key areas.
The quantity and quality of resources required by tax administrators are to a large extent determined by the type of tax system which is introduced, with the same objective that the
Taxpayers’ money pays for government services of all kinds.
Although taxes are considered a legal requirement, paying taxes is also considered a civic duty.
However, despite the revenue reported by the government over the years, Roads, infrastructure, Education, and the general living conditions of Nigerians fail to commensurate the huge revenue accruals.
The correlation between taxation and economic growth has become a contested subject as taxation has an impact on the economy, and firms and individual decisions are also affected by tax
Government has by the statistics available, complained that the revenue has been insufficient in meeting its social and public spending which is important to enhance economic growth.
The claims, for many Nigerians, are a ruse and don’t holds water.
According to the Economic Recovery and Growth Plan ERGP, 2017, the 4.8 percent annual growth rate between 2011 and 2015 was mostly driven by high oil prices and was generally non-inclusive.
Continuing, the majority of Nigerians are still suffering from severe poverty, inequality, and unemployment, according to this document ERGP, 2017.
The reasons for the heightened poverty, bad roads, and educational systems have been attributed to UNREMITTED TAXES OR REVENUES GENERATED that would have played a key part in alleviating the listed features.
Road Network systems in Nigeria haven’t quite benefited in the generated revenue since the inception of the Second Republic and democratic precedent
This has greatly swirled the deplorable states of Nigerian Roads.
The cost of either constructing or maintaining a kilometer of road in Nigeria is extremely high when compared to other African countries which partly explains the dire situation of roads in the country.
Many concerned Nigerian find it true to believe that it is difficult to determine the cost of road construction or maintenance per kilometer.
The neglect given to road infrastructure in Nigeria is the reason the transport sector in the country is underperforming.
Chief Patrick Eholor, is the Founder of One Love Foundation which has been very critical of transparency in governance.
Speaking with our Correspondent, Eholor demanded that the Taxes being paid should reflect on Roads, Infrastructure, Education, and other areas that will bring positive changes to the country
According to Eholor, transparency in Revenue will contribute to the sector, especially while the gross domestic product GDP has been on a downward trend.
He noted, with concern, that
those who have been diverting the revenue are birds of the same feather and are culpable of corrupt practices that have buildings in Asokoro, Abuja, and other parts of the country diverting taxpayers’ money.
Douglas Ogbankwa is a legal practitioner based in Benin who has not relented in his advocacy for good governance.
Ogbankwa in his words noted that: “The Huge Revenue generated by the designated revenue-generating Ministries Departments & Agencies in Nigeria has not reflected in the living standards and the development of the Country.
He said, “Much of this revenue can not be accounted for as there is a huge Gulf between the poverty of Nigerian People and the wealth of Nigerian Leaders”. Since Nigeria’s return to Democracy in 1999, there has been a downward slide in the sincerity (or upward slide in the lack of it ), in the development trajectory of the Country. Nigerians are suffering amid plenty.
Funds running into trillions have been voted to make roads accessible but eventually ended in individuals’ pocket
The 2018 budget document has shown that Twenty new road construction projects across the country will cost N13.3 billion.
In October, the ministry “received” proceeds from Sukuk bonds subscription worth N100 billion to fund repairs of 25 key economic road projects across the six geo-political zones of the country.
While appearing before the senate committee on Federal Roads Maintenance Agency FERMA, Babatunde Fashola, minister of power, works, and housing, said the N100 billion sourced through the Sukuk bond was yet to be released.
He credited the delay to conditions linked to the fund, saying the ministry will “do something” about the road projects given the high traffic usually recorded at the end of the year.
Fashola had also said the worst roads in the country were located in the south-south and southeast geopolitical zones.
Edo State connects from Ovia, the Western region of the country, from Orhiomwon, linking the Eastern region, From Auchi, to the Northern Region and the FCT, from Ikpoba Okha, links various parts of the Niger Delta Region
So, therefore, the Six geopolitical zones are linked to Edo State making it the most important route in Nigeria.
The deplorable state of Federal Roads in Edo State has been a source of worry for most road users and has become a national anthem in the State.
Starting from the failed portions at the Benin-Sapele Express Road, Benin- Ekpoma-Abuja Express Road, Agbor Park, and Ovia River of the Benin-Lagos Express Road, you will be forced to believe that Edo State doesn’t exist in all of it, despite huge budgets from successive governments.
Multiple accidents in the last months took tens of hundreds of citizens’ lives including the last week’s accident at the failed portion of the Ovia river along Benin-logos express road where some worshipers were returning from a program in Lagos and died in the fatal accident.
The incident at Ovia River is a testament to the numerous accidents that have claimed lives due to bad roads.
For several years now, the failed portion at Ekpoma has not been addressed even though revenues are collected from long trucks and other vehicles plying the route.
Driving through the axis most often takes several hours and most times vehicles are stuck living motorists to groan with little or no help coming from the government.
The same poor state of roads has impacted businesses negatively, resulting in poor productivity of workers as immeasurable manpower is lost in traffic congestion daily and avoidable accidents, Benin Sapele Road being a testament to vehicular struggles.
Early this year, some protesters led by Daniel Omorogbe, Chairman, Sarbag/Sapele road axis, said the blocking of the major road and its adjoining streets has become necessary, following a series of avoidable deaths and unquantifiable man-hours commuters expend on the road while trying to get to their respective destinations.
Omorogbe added that the residents of the environs have taken it upon themselves to reduce the incidence of deaths on Benin-Sapele road and also put an end to the nightmare their children face when going or returning from school.
He said when the road got bad previously, they went on a peaceful protest, which drew the attention of the Edo State government to commence work on it, only for the Federal Government to allegedly stop the state government from carrying out palliative works on the road, claiming that it is a Federal Government road.
Government officials have been on the same road demanding vehicle owners who ply various roads to comply with Vehicle taxes to generate revenue that will probably go into individuals’ pockets.
Most failed portions also serve as a hotbed for the twin evils of robbery and kidnapping.
But nobody holds government even at the behest of numerous protests challenging them to build roads for accessibility of the masses.
From all indices, the government wants poor people to add the Little they have to the millions stolen to further impoverished them.
Road infrastructure has been seen as a major cause of urbanization.
So, when bad roads hinder investment that creates employment and improves the living standard of people in a pain turn location, this affects the rate of income people make and in turn, degenerates the revenue of the government.
Government at all levels must use revenue generated to build hospitals, good roads, and Schools to earn the trust of the people they serve.