From Uche Usim, Abuja
The Federal Government on Monday, lamented the heavy revenue haemorrhage arising from tax waivers granted to achieve identified developmental milestones.
The Minister of Finance, Budget and National Planning, Mrs Zainab Ahmed, made the disclosure in Abuja during a workshop on Tax Expenditure, organised by the Economic Community of West African States, under the context of the implementation of Support Programme for Tax Transition in West Africa.
Ahmed, who was represented by the Director, Technical Services in the Ministry, Fatima Hayatu said while the government was committed to reducing tax expenditure, the nation’s current revenue to Gross Domestic Product ratio of about seven per cent was poor and unsatisfactory.
The PATF aimed to improve the management of domestic taxation and ensure better coordination of taxation in the ECOWAS and West African Economic and Monetary Union regions.
The Minister observed that Nigeria’s low revenue generation capabilities had been an enduring challenge to past and present governments.
She said that although Nigeria was celebrated as the country in Africa with the largest economy, translating the wealth into revenue generation had remained According to her, Nigeria is faced with challenges in mobilising domestic funds necessary for human capital development and infrastructure that are both drivers of sustainable economic growth and development.
The Minister observed that Nigeria’s low revenue generation capabilities had been an enduring challenge to past and present governments.
She said that although Nigeria was celebrated as the country in Africa with the largest economy, translating the wealth into revenue generation had remained a serious issue.
According to her, Nigeria is faced with challenges in mobilising domestic funds necessary for human capital development and infrastructure that are both drivers of sustainable economic growth and development.
Ahmed said, “Our current revenue to GDP ratio of about seven per cent is unsatisfactory and we are keen on exerting improving this by implementing various initiatives.
“The case remains the same with our current contribution between oil and non-oil GDP, for which our analysis on oil revenue to oil GDP reveals as 39 percent while non-oil revenue to non-oil GDP as 4.2 percent. Our Value Added Tax revenue to GDP in Nigeria for example stands at less than one per cent (0.8 per cent) which compares unfavourably to ECOWAS average of 3.4 percent.