Louis Ibah
The Lagos Chamber of Commerce and Industry (LCCI), has faulted the Federal Government tax policies, saying they are frustrating private sector investments and efforts geared at diversifying the economy.
Director-General of the LCCI, Mr. Muda Yusuf, in a release entitled “Agenda for Economic Diversification” made available to Daily Sun, faulted the tax policies of President Muhamadu Buhari as inherently a disincentive to investment and economic diversification.
His words: “The renewed aggressive tax drive of the government is focused more on investors than consumers and the burden of taxation is more on the investors in the economy than the consumers.
“The Federal Inland Revenue Service (FIRS), has scant regard for due process in its drive for revenue. It is, therefore, inherently a disincentive to investment and economic diversification. “In an economy which is almost 50 per cent informal, this structure of taxation is not investment friendly as the formal sector of the economy bears the largest burden of the tax system,” Yusuf added.
Accordingly, Yusuf demanded that the tax policy at federal, states and local government levels needs to be better attuned to economic diversification through a reversal of the tax burden from investors to consumers.
“The use of banks as collection agents for the FIRS (in its current form) is very disruptive, distracting, arbitrary, oppressive and unfair to investors. It is a serious disincentive to investment and the promotion of financial inclusion. This approach should be discontinued,” demanded Yusuf.
He said taxation should not be seen only as an instrument of revenue generation, but also a potent instrument for stimulation of investment in Nigeria.
Yusuf also listed the following three critical factors are crucial to drive economic diversification in the economy. These are: the quality of infrastructure, the quality of policies, and the quality of institutions.
“It is crucial to get these key parameters right. It is equally critical to ensure proper alignment among these key variables to ensure sustainable economic diversification,” he added.