BY CHISOM NWATU
Zainab Ahmed, Nigeria minister of finance, budget and national planning, has stated that federal government policies on tax exemption and concession represent one of the major sources of huge revenue leakages in the country.
Ahmed, who was represented by Fatima Hayatu, director, technical services in the ministry, at a workshop on tax expenditure organised by the Economic Community of West African States (ECOWAS) in Abuja, observed that tax exemptions and concessions that were granted to flourish and develop the economy currently constitute huge tax expenditures and revenue leakages to the government.
She added that 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.
Describing Nigeria’s current revenue to gross domestic product (GDP) ratio of about seven percent as unsatisfactory and unfavourable in comparison to ECOWAS average of 3.4 percent, the minister said the federal government is making efforts towards an improvement by implementing various initiatives.
“The case remains the same with our current contribution among 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,” the minister said.
In this regard, she said the government had recently given a tax expenditure statement or circular to important agencies of government, showing instructions, rules and regulations to ensure strict adherence compliance and reporting.
She commended ECOWAS commitment towards improving tax generation and blocking leakages by undertaking the Programme for Tax Transition in West Africa (PATF).
Salifou Tiemtore, director of customs union and taxation, explained that the PATF programme would enhance the fight against fraud, tax evasion, illicit financial flows and other forms of corruption in the region.
Tiemtore further disclosed that efforts would be made to ensure improvement in the management of tax among member states through the PATF tools.