Nigeria Facing Huge Economic Challenges – Osinbajo, Lawan Admit

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The federal government of Nigeria has admitted that all is not well with the nation’s economic situation and efforts must be re-engineered to correct the situation.
Speaking differently at the same occasion, Vice President Yemi Osinbajo and Senate President Ahmad Lawan submitted that despite government efforts and commitment, the economy is facing difficult challenges.

Bibian Anekwe News reports the two top officials spoke through their representatives at the 40th Anniversary of the Chartered Institute of Taxation (CITN), in Abuja on Tuesday.
In the words of Lawan who was represented by his special adviser on Economic Matters, Prof Nazif Abdullahi Darma, Nigeria’s economy is not growing at the same rate as its population.

He also observed that the amount been spent on debt servicing is on the increase, rising from $2.5 trillion in 2019 to $4.2 trillion in 2021.

“Last year it got to $11. 93 trillion. And today, we have almost half a trillion deficit of expenditure in terms of infrastructure delivery. Invariably, the economic problem in this country cannot happen without the active operation and collaboration of especially elitist groups like CITN and other professional bodies,” he stated.

He added that with a growing population, the tax net should be widened to ensure citizens pay their tax accordingly to the government which will, in turn, be used to provide structures and amenities for the growing population.
Our economy is a growing one. We have over 200 million citizens. We have a growth rate of over three percent. Meaning, every year, 6 million citizens are added.

‘On a daily basis, 26,000 babies are born. These demographic indicators are real challenges of providing quality social service welfare for its citizens,’ he stated.
He added that “In most democracies in the world today, people’s participation in governance is predicated on the ability of those citizens to pay taxes as and when due. And that is where we saw a lot of fundamental questions raised on the way and manner the economies are being managed because taxpayers are actually the contributors of the resources that are used in running such economies.”
On his part, Vice President Yemi Osinbajo pointed out that Nigeria’s tax to GDP ratio is one of the lowest in the world while its comparators are in the neighborhood of about 15 percent to 25 percent.

He lamented the over-reliance of the country’s economy on oil which he said is causing economic imbalance.

Represented by the Minister of Finance Budget and National Planning, Mrs Zainab Shamsuna Ahmed, who in turn was represented by the Permanent Secretary, Ministry of Finance Budget and National Planning, Mallam Ahmed Aliyu, Osinbajo called for sustained efforts in diversifying and building the economy.

“Nigeria’s tax to GDP ratio is one of the lowest in the world. It is at about 8 per cent while our comparators are in the neighborhood of about 15 per cent to 25 per cent. Even in Africa wecan surely do better. This is symptomatic of undue reliance on oil revenue as a result of fiscal imbalances in our nation’s financial landscape. The achievement of government’s objective of widening the tax base for improved revenue collection through voluntary compliance in line with international best practice will be enhanced through co-operation with and support of the institute being a major stakeholder in the tax system of our nation.

“We are happy with the results of sustained efforts towards enhanced tax compliance despite the global economic challenges occasioned by the COVID-19 pandemic and the disruption of economic activities by 2020 protests. Nonetheless, tax administration has made significant improvement in collections. FIRS was able to exceed its collection target for Year 2021 with N6.450 trillion from both oil and non-oil revenue,” Osinbajo stated.
Earlier during the event, the president of CITN, Adesina Adedayo, said that the institute would continue to contribute meaningfully to the nation’s development and improve on its roles in line with current demands and realities.

‘Therefore, we consider it worthwhile to reflect over the past years, celebrate what we have achieved, take cognisance of our shortcomings and to continuously reposition the institute for the next level of greatness,’ he said.

Bibian Anekwe News

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