The Chairman of the Presidential Fiscal Policy and Tax Reforms Committee, Taiwo Oyedele, has expressed deep concern over Nigeria’s annual loss of up to N6 trillion in tax waivers.
He emphasized that this staggering figure is equivalent to the country’s annual revenue, and the lack of assessment regarding the economic consequences of these waivers is troubling.
Oyedele made these remarks during a recent appearance on the Channels TV Sunrise Daily program, shedding light on the magnitude of the issue. He highlighted that various levels of government have failed to gauge the impact of these tax waivers on the nation’s economy.
“In fact, we are giving away about N6 trillion annually,” confirmed the financial expert, corroborating a figure previously quoted by the Senate regarding tax waivers. He went on to underscore the absence of a comprehensive evaluation of the economic viability of these substantial tax waivers, which significantly dwarf the country’s revenue base.
“If we were a country where we’re making N60, N70 trillion and we give away N6 trillion, maybe we would say, ‘We can live with it. But the revenue generated by the FIRS in 2021, the year before the last, was just barely N6 trillion. And then you give that away in tax waivers and incentives,” Oyedele lamented.
Despite these alarming statistics, Oyedele revealed that the committee has recommended certain immediate actions to address the economic challenges facing Nigeria. One of the key suggestions is the suspension of Value Added Tax (VAT) on diesel and essential services, a move deemed crucial in light of the country’s current economic reality.
“Presently, I’ve proposed to the government the suspension of VAT on diesel for obvious reasons, as well as the suspension of VAT on import duties and Compressed Natural Gas (CNG). There are certain measures that must be implemented, considering that governance ultimately revolves around the welfare of the people. While the immediate economic impact of these measures may be difficult to measure, their positive social impact cannot be denied,” Oyedele affirmed.
As Nigeria grapples with fiscal challenges and the need to bolster its revenue generation, the revelation of substantial annual tax waivers raises questions about the country’s fiscal policies and the imperative for a comprehensive evaluation of their economic ramifications. The government will undoubtedly face increased scrutiny and calls for reform in response to these revelations.
