President Bola Ahmed Tinubu has announced plans to double the nation’s revenue within three years.
Speaking last night on a television programme, Special Adviser on Revenue to President Bola Ahmed Tinubu, Zach Adedeji said the target would be met using technology and data without raising taxes.
Adedeji said the focus will be on organised collection of non-tax revenue in line with the Constitution, which indicates that all collectable revenues shall be channelled into the Federation Account.
He further explained that the Nigeria National Petroleum Company Limited (NNPCL), Nigeria Customs Service, Federal Inland Revenue Service, Nigeria Maritime and Safety Administration (NIMASA) and other revenue-generating agencies of the Federal Government would not be merged as been speculated.
They will have their collections integrated for efficiency and accountability, he explained.
Adedeji implied that there will be a change in tax and finance laws of the federation.
“When we talk about harmonisation of all these revenue collections, these agencies have done their best. But when we begin to apply technology and data, everything will change,” the presidential adviser explained.
He added that the plan was to bring on board, non-taxable revenue, which will ultimately empower the capacity of the underprivileged in the country.
According to Adedeji, Nigeria has 52 various taxes but less than 10 are being accounted for.
Admitting that revenue was a challenge for the government, he maintained that Tinubu has the capacity to surmount it.
Adedeji revealed that there were also plans to review existing tax and financial laws.
He also said that it takes a courageous leader like Tinubu to have implemented some economic policies like ending petrol subsidy, unifying exchange rates and suspending some taxes.
The Special Adviser, who lamented Nigeria’s tax generation to Gross Domestic Product (GDP), said that the country generates about N15 trillion but budgeted N20 trillion this year.
He said: “In any economy, one thing that is very scarce and never enough is money. If you follow the law of economics, there is what we call the law of diminishing returns. Revenue will also be a limiting factor.
“But if you consider the antecedent of President Bola Ahmed Tinubu, you will know that he has the capacity to draw water from the rock.
“The President’s general vision on revenue is very clear. And from what he has done, you’ll see that it is not just, tax, tax and tax!
“He has a broad vision and believes that the success of revenue management and collection comes from three places.
“The first is the economic policies. His intention is not to tax poverty but to tax prosperity; his intention is not to tax production but to tax consumption.
“That is the first line by removing two impediments that militate against our economic prosperity and that is the removal of fuel subsidy and the unification of the exchange rate that the Central Bank of Nigeria has done. Those two are the foundation for where we are going.
“This was done to make the economy run. The second one is boosting the citizens’ confidence. They have the right to know what their tax is being used for.
“And the last one is the effective tax administration.
“Though revenue may be a challenge, if you consider our robust plan, you’ll see that we have plans to actually generate more that will be enough for us to run our government.
“It is true that Nigeria has a revenue problem. Our revenue to GDP ratio is almost the lowest in Africa and by extension in the world.
“If you look at South Africa, in 2022, it collected the equivalent of N65 trillion, while we collected under N15 trillion with almost times three of SA’s population.
“If you look at our debt to revenue, that is also a pointer that there is a problem. About 90 percent of our revenue is used to service debt. So, it is clear that we have a revenue problem. Notwithstanding, that will not deter us from what we want to do.
“We have identified multiple taxes, multiple generation agencies and collection, lack of data, and lack of technology among others, that confront our ability to actually generate what we need. And we have plans to resolve all of them.”
He reiterated that Tinubu’s goal was to unveil a sound economic programme that would lead to shared prosperity.
On the need to review some laws, the Special Adviser said: “As of today, only two laws are available for our fiscal policy. They are the Finance Control and Management Act of 1958 and the Fiscal Responsibility Act.
“So, you can imagine us still operating with a 1958 law. Britain gave us The Stamp Duty Law in 1939 when there was no internet.”
He added that the laws gave room for leakages, hence the need to review them to meet present realities.