Quite recently, a number of government policy and actions is being interrogated for their inconsistency. Policies such as the stance of the Federal Government (FG) to completely close the land border with Benin Republic may have laid a firmer foundation for higher inflation.
While the economic recession of 2016 was ongoing, President Muhammad Buhari admitted publicly for the first time in August of same year that the country is broke. In the space of same year, Nigeria was said to have overtaken India in the poverty index. The Debt Management Office (DMO) recently revealed that the government is finding it difficult to meet up with its obligation of servicing its fast-bloating loans.
Other indicators have also been pointing to the fact that the government is going broke again and desperate to rake in more non-oil revenue than ever as crude oil price at the world market is falling and can no longer sustain our fast-rising population.
Increasing revenue prospect at the financial expense of poor Nigerians would be the worst thing a government can ever do to its citizens.
The flurry of tax rhetoric which the Federal Government has been singing consistently in 2019 is not without cause. After the Finance Minister, Hajia Zainab Ahmed, mulled the option of raising Value Added Tax (VAT) from 5% to 7.5%; a senator in the Red Chamber of the National Assembly proposed an alternate bill which would tax usage of Telecommunications services such as SMS, and Cable TV subscriptions. As if that would not be enough, the Finance Minister last week hinted that the FG is considering taxing soft drinks such as Coca Cola, Bigi Cola and others under a special tax category. When the report now aired that the World Bank would be financing another round of loans to the power sector to the tune of $3 billion, Nigerians were aghast as to the country’s ability to pay up when the time comes.
The fact of the matter can only add up to mean that the policy advisers in the presidency are advising the president to increase the tax net so as to generate more revenue for the government to spend. But how frugal does the government spend or manage these hard-earned resources?
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However, the prospect of generating more revenue for the government via increasing the tax net is altogether ambitious and counter-productive as recent data shows. According to a report, the Voluntary Assets & Income Declaration Scheme (VAIDS), a tax amnesty program which was targeted at raising up to a target of N300 billion, only raised N30 billion. In essence, there are already signs that this move to increase taxes which the citizens pay would only amount to scratching the surface in its success rate as it looks for alternative means of generating government revenue.
It is just about 5 months into President Buhari’s 2nd term began with the goal of securing Nigerian lives and property and not otherwise through policies. What the role of government at all levels should be is not to look for every opportunity to drain the resources which the people are managing, but instead to seek other means which will prosper the nation.
Whether the president realize and admits the dire situation of the country’s finances for a second time or not, the fact remains that Nigeria will not be the first to go very broke with the possibility of bouncing back into national wealth once again. Those to who shoulder the public responsibility of managing our national resources should do so diligently and creatively without making the majority of poor Nigerians commit financial suicide in the course of saving the country.
The policymakers advising the president, as well as the president himself, would need to have awake to exploring other better techniques for re-enriching a broke nation without killing its people with spurious levies and taxes.
Featured Image Source: Pulse NG
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