By Barnabas Esiet.
Dr. Oluwasegun Alade Musa, Group Managing Director of Widescope Group of Companies and CEO of Global Transport Policy, has strongly condemned the current tax regime in Nigeria, describing it as “fraudulent”.
Dr Musa, in an exclusive chat with Newsshelve in Lagos recently said Nigerians pay the highest taxes worldwide, with individuals and businesses facing multiple taxation at the local, state, and federal levels.
He highlighted that under the current regime, Nigerians pay an average of five to six taxes at the local government level, twelve taxes at the state level, and seven taxes at the federal level.
Musa argued that this multiple taxation system is not only oppressive but also discourages businesses from operating in the country.
The business mogul criticized the government’s decision to increase the Value Added Tax (VAT) from 7.5% to 10%, and potentially to 15% and 25% in the future.
He pointed out that this increase does not address the issue of multiple taxation, which continues to burden individuals and businesses.
Dr. Musa also expressed frustration with the withholding tax system, citing his own experience where the Federal Inland Revenue Service withheld N27 million from his company’s account. He argued that this system is unfair and fails to provide liquidity support to businesses.
Comparing Nigeria’s tax regime to those in other countries, Musa noted that foreign tax systems are more flexible and allow for deductions and exemptions. In contrast, Nigeria’s tax system is rigid and fails to support businesses or individuals.
The business leader warned that the current tax regime will lead to the collapse of businesses, as companies are forced to cut corners to survive.
He cited examples of companies reducing the quantity of their products to maximize profits, while still paying high taxes.
Musa concluded by emphasizing the need for a more equitable and supportive tax regime that encourages businesses to grow and thrive.
He argued that the government should focus on building indigenous capacity and reducing the tax burden on individuals and businesses.
The issue of multiple taxation in Nigeria is a complex one, with various stakeholders offering different perspectives.
According to a report by Mondaq, multiple taxation arises when two or more jurisdictions tax individuals and businesses on the same income. The report highlights the need for uniformity in tax laws and regulations to avoid confusion and overlap.
In recent years, there have been efforts to address the issue of multiple taxation in Nigeria. For example, the National Tax Policy Document recommends that each tier of government should have a clear understanding of its tax powers and responsibilities to avoid duplication and overlap.
However, despite these efforts, the issue of multiple taxation remains a significant challenge for individuals and businesses in Nigeria.
As Musa’s comments highlight, there is a need for a more comprehensive and equitable tax regime that supports economic growth and development.
Comment here