The love triangle among the three tiers of government for a mono economy like Nigeria’s fuels the deafness and provides no sense of foresight for political office holders to diversify the economy. Therefore, an attempt by economy analysts to judge the true state of the Nigerian economy to the satisfaction of those in political office has always been difficult. But never more so than now, as any contrary opinion from the belief of the ruling government would be punctured by name calling and tagged fake news.
However, just when Nigerians were about to succumb completely to despair and despondency over their sour mood about the reality that the crude oil economy is becoming a thorn in their flesh, one of the most brilliant discovery that located the nation’s long forgotten treasure island was made. For government apologists, the discovery is without question a decisive breakthrough to keep the Nigerian economy afloat and a veritable weapon in the economic recovery effort. But more importantly, it falls in a line of thought along William Blake’s who once wrote: “I must create a system or be slaved by another man’s”. It is obvious that, over the years, Nigerian government past and present have been slave to oil money through its control by the international market price.
Of late, the most surprising aspect of the Nigerian economy is not the revelation that it is a floating economy. If you are not aware about this fact, it means you were not paying attention to the ruling government’s regular announcement that the economy is surviving only by a shock-absorber strategy, which of course, is the constant borrowing and begging for debt relief or cancellation. However, the real astonishing news about the nation’s economy is the recent claim by the Federal Inland Revenue Service (FIRS) that receipt from tax now accounts for 70 per cent of the nation’s revenue as it relegates oil to 30 per cent. This was made known by FIRS executive chairman, Muhammad Nami the other day during an interactive session with stakeholders titled: “Weathering economic turbulence” in Abuja. Ironically, the likely hero that may save the nation’s economy is a concept that most Nigerians do not want to be familiar or associated with. For many, tax is an experience where the government enjoys skinning the masses without any tangible benefit for society to enjoy. Still many others found that in taxation, it is supposedly the closest thing in a capitalist society as certain individuals are either exempted or seen as untaxable. However, the mystery why FIRS identified tax as a priority to the nation’s revenue drive under the current harsh economic circumstance is hard to comprehend.
With the second wave of recession hitting the country, a fate that economy analysts had been gloomily predicting since the economy shrank on the outbreak of coronavirus pandemic that crashed the international price of crude oil, the ruling government needs to do the needful. Indeed, it is hard to believe that the ‘black gold’ the world so earnestly depend on could suddenly be jettisoned, forcing oil producing country like Nigeria to seriously look inward for other sources of income. Until recently, Nigeria carried itself with splendour and created a false impression of being the ‘giant of Africa’ because of oil wealth, having neglected every other credible sources of income. The ruling government has no choice than to stoop with hope to conquer through milking the people with tax.
As it were, tax as the nation’s current biggest revenue earner is causing President Muhammadu Buhari government to thumb his chest and crow having discovered the magic wand inwardly. Indeed, it is cheering news that Nigerians have woken up from the slumber of tax evasion just as the ruling government had decided to hit the ground running after tax evaders. Notwithstanding the great discovery on tax, some pertinent questions are begging for answer. How did FIRS arrive at the 70 per cent conclusion on income tax as the revenue drive when the unemployment industry is growing daily? Also, knowing that several small and medium scale industries have closed down due to COVID-19, where then did the volume of tax come from? Anyway, now that tax has been authoritatively identified as the new revenue bride, Nigerians are therefore condemned to pay more for everything despite extreme cost of living among the masses at crisis point due to COVID-19 realities. Indeed, navigating to a new revenue system may not be very easy at this august period of coronavirus pandemic that industries, businesses and citizens alike are struggling to survive. This new phase of revenue chase is likely to provoke more challenges for the government than cheap oil money which has been marked by a remarkable degree of less stress.
Without prejudice, let us remind ourselves of what used to be the economic earner for the country in the not too distant past. Before the advent of oil, the country’s regions were known for their agricultural prowess. The groundnut pyramids in the North, the cocoa harvest in the West and cotton and palm oil yields in the East among other cash crops that held sway in developing the country then. Regrettably, oil exploration put a sharp end to these dignified earnings and self -sustaining economic drives. Besides, instead of enjoying blessings from oil exploration, it brought more curse and grief to Nigerians and particularly so for the people in oil producing areas. Aside pollution and degradation of the Niger Delta region, an environmental activist, Owens Wiwa recently lamented in an article published in The Guardian on November 10, 2020 that the only federal presence in Ogoni land 25 years after the killing of Ken Saro-wiwa is a prison and a cemetery. Of course, the message is not only clear but speaks for itself. If you protest the pollution of the land and rivers you may either be killed and buried in the cemetery or arrested and jailed in the prison.
Undoubtedly, the tax revenue drive in contrast, may intrude into areas of vital national interest. For instance, how much tax does a political office holder pay? No doubt, the FIRS would encounter a heinous task to collect exact tax from political office holders as many among them assume they are above the law. One hope that the current measures in force to collect tax should not only be maintained but devoid of sharp practices. If there is one thing that Nigerians wanted from FIRS in its obligation regarding tax, it is to make its dealings transparent and to free itself from the yoke of corruption. However, a low point for the FIRS was seen in the recent Senate queries over unremitted tax and VAT deductions amounting to huge sums of money. This is not only sending a wrong signal but making the FIRS look nearly as scandal-prone to what oil money did to every government that tasted it
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