These are indeed hard times for Nigeria. The lackadaisical political ambience has been well indicated by the ravaging cases of a nationwide insecurity and a regressing economic situation. The country is overtly on the brink of being broke and one of the clearest indicators of this crisis is the country’s growing debt profile. The Centre for the Promotion of Private Enterprise recently raised concerns about this situation, noting that the country’s national debt alone could soon hit the N50 trillion mark. CPPE, in its first quarters economic review also reported that the growing debt profile of the country raised imminent sustainability risks.
Zainab Ahmed, the Minister of Finance, Budget and National Planning in procuring a solution to the debt crisis, has insisted that the collection of more taxes and effectively blocking revenue leakages were feasible measures to cut down borrowing drastically and reduce the country’s debt burden. This was noted at a workshop on tax expenditures which was organized by the ECOWAS Commission under the context of Implementation of the Support Program for Tax Transition in West Africa held in Abuja. This workshop is proposed to examine measures on the harmonization of tax expenditure management practices, as well as monitoring and evaluating tax transition in ECOWAS member states.
Tax expenditure issue remains a major concern for the government.
Represented by the Director of Technical Services in the Ministry, Fatima Hayatu, the Minister stated that the recurrent problems of tax expenditures have been of immense concern to the government. In fact, the government in July, disclosed that the country’s debt service cost in the first quarter of the year was at N1.9 trillion, which was N310 billion more than the revenue received as of this period and an indication of the debt service significantly outweighing the country’s revenue.
The finance minister however stated that the debt burden could be contained by the government. She noted that by accruing more taxes and redirecting these taxes to the needed fiscal sectors of the economy, it would possibly be easier to reduce the debt burden. She however commended the government on the evaluation of the gross domestic products (GDP) rate. She also pointed out that the program was a means to procure measures to block leakages which of transparent, will help Nigeria borrow less and with enough funds to finance other sectors.
Government to commence rationalization of tax exemptions.
Upon observation of the traction that reforms in tax expenditures have been making in Nigeria, the minister noted that this development was as a result of the in-house capacities and internal restructuring in agencies to ensure a better efficiency. She also iterated the government’s plan to commence rationalization of tax exemptions by gradually phasing out antiquated pioneers and other incentives for developed industries. She noted that contrary to what was previously obtained, immense benefits were now being achieved from tax exemptions and the concessions offered to small businesses.
Explaining further, Zainab Ahmed pointed out that immense changes have occurred since the system became more transparent and the given tax expenditure by the government will improve growing industries and help create more jobs. She also noted that this tax expenditure initiated by the federal government helped many businesses stay afloat even during the Covid-19 pandemic and to keep their staff. She said that this was a huge achievement, as these lost jobs could have increased the dilemma of insecurity currently ravaging the country.
ECOWAS member-states urged to mobilize taxes to offset revenue decline.
However, the minister indicated Nigeria’s commitment to improving the transparency in its public financial management toward enhancing the mobilization of domestic resources. Cecile Tassin-Pelzer, the head of cooperation, European Union for Nigeria and ECOWAS complained about the low tax to GDP ratio in West Africa. Observing domestic revenue as a major source of government’s expenditure funding and the challenges of revenue mobilization, she urged the member states of ECOWAS to further mobilize more taxes so as to offset the imminent revenue decline.
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All this increament in tax collection will not help in anyway because already the bad economy is hitting the citizens badly,major problem facing the economy of Nigeria is corruption.Unless something is done concerning corruption,I don’t see any meaningful improvement in the economy.
Too much tax on the citizenry is not helping at all,and the countries debt is on the high and more needs to be done by the government our debts can’t just keep skyrocketing day and night.
Imposing too much tax on citizen will make people suffer it will just be too hard on the people another solution should be come up with another way to clear debt, our debt cannot just b going up without try not to be clearing it
All of this effort to increase tax collection won’t be of much assistance because the residents are already suffering greatly from the weak economy, which is a big issue in Nigeria. I don’t see a significant change in the economy unless something is done about corruption.
Measures that could have been taken to dramatically reduce borrowing and the country’s debt burden included a rise in tax collections and the successful sealing of revenue leaks.
The withering cases of national insecurity and a declining economic condition have been clear indicators of the apathetic political atmosphere.
It is quite evident that the nation will soon be unable to meet its financial obligations, and the expanding debt profile of the nation is one of the most glaring signs of the impending financial disaster.
The ravaging examples of a widespread insecurity and a regressing economic position have both provided clear evidence of the apathetic political atmosphere that has pervaded the country.
The nation is obviously on the verge of bankruptcy, and the rapidly increasing debt profile of the country is one of the most obvious signs of the severity of the problem.
The finance minister claimed that the government could control the debt load. It might be simpler to lessen the debt load by collecting more taxes and channeling these monies to the necessary fiscal sectors of the economy.
It was possible to cut down on borrowing significantly and lower the country’s overall debt load by taking steps such as increasing the amount of money collected through taxes and successfully plugging revenue leaks.
It has been recommended that an international workshop be held to discuss ways to improve the monitoring and evaluation of tax transition in ECOWAS member nations, as well as the harmonization of tax spending management techniques.
This initiative was a method to acquire measures to limit leakages, which, if they are transparent, would allow Nigeria borrow less money and have enough money to support other areas of the economy.
In light of the fact that domestic revenue constitutes a significant portion of the funding for the government’s expenditures and the difficulties associated with revenue mobilization, we have no choice but to urge the member states of ECOWAS to further mobilize more taxes in order to compensate for the impending revenue decline.
People will suffer if there is an excessive amount of taxation placed on them; it will simply be too difficult for the people. Another solution should be developed as well as another strategy to pay off the debt; our debt cannot continue to increase if we do not make an effort to pay it off.
If a lot of tax is impose on us. What about government bodies why can they reduce their allowance so to reduce the debt. They should live by example
I urged the member of ECOWAS to further mobilization of domestic resources because the program serves a means to procure measures to block leakages and transparent to help the country borrow less and with enough funds to finance other sectors.
The collection of the more taxes will be the burden of the people. Inasmuch as we want to pay the debts which we have borrowed, it shouldn’t be at the expense of taxing the citizens more.
Enough of imposing tax every time. Government should source for another way to generate revenue.
Good managerial skill by our government wouldn’t have landed where we found ourselves more. It is well o
Because of bad governance Nigeria is in serious debt. We shouldn’t have gotten to this level of now increasing taxes to get revenue to pay debt. Let the government cut down on their extravagant lifestyle.