Isaac Anumihe, Abuja
Centre for Social Justice (CSJ) has hailed the increase in the Value Added Tax (VAT) to 7.5 per cent as that is a source of revenue for budget implementation.
It also said that there should be transparency in the collection and remittance process.
In a statement, the Lead Director of the group, Mr Eze Onyekpere, said that this would increase available resources for budget implementation and development across the three tiers of government.
“We recall that Nigeria’s tax to gross domestic product (GDP) ratio is one of the lowest in the world and indeed in the West African sub-region. We further recall that Nigeria’s VAT rate is one of the lowest in the sub-region. We also recall that from our 2018 and 2019 budget analysis, CSJ had recommended an increase in VAT as one of the ways to shore up government revenue”, he said.
He also called on the government to increase the number of natural and artificial persons who will pay the new VAT. “However, the additional revenue to be realised from this increase may not be substantial if the tax authorities do not take concerted and targeted steps to increase the number of natural and artificial persons who will pay the new VAT. The way forward is to ensure that all persons liable to VAT, collect and remit the same to the appropriate authorities.
“While we take note of the arguments about the harsh economic conditions and how the increase will impose hardship on the poor, we note that all Nigerians ought to make sacrifices considering Nigeria’s parlous fiscal condition. Indeed, Nigeria is facing a fiscal crisis which, ideally, the leadership should explain to Nigerians instead of the current official attitude that all is well”, he explained.
According to him, the hard times call for increased fiscal transparency and accountability on the part of government which manages public resources.