The value added tax on diesel, commonly known as automotive petrol oil, should be suspended, according to Taiwo Oyedele, chairman of the presidential committee on tax policy and fiscal reforms.
Oyedele said, President Bola Tinubu’s directive to suspend the VAT will mitigate the negative economic effects of the elimination of gasoline subsidies.
Oyedele, who appeared on Channels Television’s Sunrise Daily programme on Wednesday, said, “What the President wants us to do is that within the first 30 days, there are those low-hanging fruits that people have generally agreed that this is a problem but nobody has done anything about it.
“Personally, for example, this is not promising that it would be done, but I think that we should suspend VAT on diesel because we removed fuel subsidy on petrol and prices are going up.”
“We are going to table it before the committee. These are the things we want to do in the first 30 days,” he mentioned.
Oyedele, a former Fiscal Policy Partner and Africa Tax Leader at Price Water house Coopers was appointed by Tinubu to head the committee whose scope includes fiscal governance, tax reforms and growth facilitation.
Speaking further, Oyedele revealed that the nation’s fiscal governance covers issues ranging from debt limit to the ratio of deficit to Gross Domestic Product (as indicated in the Fiscal Responsibility Act), reporting revenue generation and the quality of spending.
He stated further that there’s a significant tax gap “estimated in the region of 20 trillion or even more.”
Oyedele noted that a lot of people within the tax net, especially the middle class and the elite, aren’t compliant with tax regulations, adding that “some of them are in the tax net with one or two fingers. In fact, our plan is to repeal many of the taxes that currently make doing business difficult without introducing new ones, and yet collect more.”
Oyedele stated that Nigeria’s revenue generated via tax is one of the lowest in the world.
He advised that, for the nation’s economy to benefit from revenue generation, the collection of revenue should be assigned primarily to the Federal Inland Revenue Service, while reducing the revenue generation burden on the Federal Government’s Ministries, Departments, and Agencies.
The committee chair said, “At the Federal Government level alone, we had 63 MDAs that were given revenue targets in the 2023 budget,” adding that “these agencies are being distracted from their primary function which is to facilitate the economy.”
He also noted that the revenue collection in such agencies will be inefficient, as “they were not set up to collect revenue.”
Oyedele disclosed that the committee will be “very intentional’ in looking at the detail, while also creating a million jobs in the digital economy.
Furthermore, he said the one-year timeframe was set up “purposefully,” with one year for the implementation of its policies.
He noted that the 30 days, six months and one-year periods run concurrently.
He stated that “every state should just have one law that covers everything collectible by local government and the state government.”
He also called for the transparency of such laws by relevant authorities.
BIG STORY4 days ago
BIG STORY13 hours ago
BIG STORY3 days ago
BIG STORY3 days ago
BIG STORY2 days ago
BIG STORY2 days ago
BIG STORY3 days ago
BIG STORY3 days ago