Progressive taxation will boost revenue generation, social justice – stakeholder
Blessing Odega
NAN-HE-5
Taxation
Jos, May 24, 2017(NAN) Mr Celestine Okwudili, the Programme Coordinator of Good Governance in Oxfam Nigeria, has called on the Federal Government to introduce progressive taxation to boost government revenue generation and social justice.
Okwudili told the News Agency of Nigeria (NAN) on Wednesday in Jos that the current tax system in the country was retrogressive and had affected government’s revenue generation.
He said that the system had impacted negatively on the middle and lower cadres who paid high taxes, while the multinational companies and rich individuals evaded taxes and also enjoyed tax holidays.
Okwudili described progressive taxation as a system that increases taxe as one’s income rises.
“Progressive taxation should be embraced to halt the current system whereby disproportionate taxes are levied and collected from the middle and lower classes.
“This is while multinational companies receive tax incentives worth an estimated $2.9 billion a year, while small and medium-sized businesses and workers in the informal sector face multiple taxes.
“Government should ensure that big businesses and wealthy individuals pay their fair share of tax which will in turn boost the nation’s revenue base and such funds can be invested in vital public services,” he said.
He said that progressive taxation could come in other forms like estate taxes or luxury taxes on goods.
Okwudili said that the luxury taxes could be imposed on goods like jewelry, expensive automobiles and some brands of alcohol and tobacco.
“These taxes are progressive in nature because they are more often paid for by people of high income or those that have accumulated more assets or wealth over time,” he said.
Okwudili said that progressive taxation would help to bring about income equality as progressive tax system acted as a tool for redistributing income from the upper class to the lower and middle class.
According to him, those individuals who earn more, pay more to the federal and state governments, thus helping to stop the income gap between the rich and the poor from growing wider.
He said that full implementation of progressive tax system would boost revenue generation of government.
Okwudili said that progressive taxation would help to bring about social justice since its proceeds could be used to fund education, medical services and welfare programmes such as the safety nets introduced by the Federal Government for those who really needed help.
He called on the central bank and the Federal Inland Revenue Service to address the issues of tax avoidance and evasion by transnational corporations operating in all sectors of the Nigerian economy. (NAN)
UBO/ECN/TA
Edited by Emmanuel/Tajudeen Atitebi