A professor of Accounting and Taxation at the University of Benin and the Federal Commissioner, Tax Appeal Tribunal, South South Zone, Prof. Ofiafoh Eiya, has lamented that the economy has been characterised by growth without development.
He stressed the need for all eligible taxpayers in the country to pay their taxes to the relevant tax authorities in accordance with tax laws.
Prof. Eiya made the assertion while delivering the 346th inaugural lecture of the University of Benin with the theme: ” Unwilling to die, yet desirous of heaven: Taxpayers’ non-compliant behaviour and the quest for economic development.”
Prof. Eiya, who said the journey towards the achievement of economic development in Nigeria over the years has faced many challenges, added that economic programmes such as austerity measures, Operation Feed the Nation, Green Revolution, Structural Adjustment Programme (SAP), health and housing for all by the year 2000 as well as Vision 2020 and 2030 were launched and pursued by government.
“Until recently, when oil prices nosedived, the evidence of any aggressive tax programme undertaken by the government to shore up its revenue from taxes is lacking,” he said.
While noting that the lecture was timely, especially now that the inflation rate is very high, and revenue from oil has nosedived, coupled with the insecurity in the country, Prof. Eiya said the lecture focuses on a shared journey towards strengthening Nigeria’s fiscal architecture, through education, research and service.
“In Nigeria and most African countries, tax policy formulation and implementation have not been effective. Tax laws and administration, which are the other components of the tax system, have not been given adequate attention.
“Hence, the tax laws are observed more in breach than in compliance in Nigeria. Registration and the creation of a database for eligible taxpayers, which is the foundation of tax administration, have not been addressed effectively.
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“Most of the eligible taxpayers in the formal sector are outside the tax net, while others pay a fraction of their taxes and levies.
“The informal sector is worse off. According to a former minister of finance, the total number of tax payers in Nigeria is just 14 million cut of the 70 million economically active people and of this 149 million, about 96 percent have their taxes deducted at source from their salaries under the Pay As You Earn (PAYE) system, while less than five percent self-employed persons comply with tax payment,” he said.
He noted that the lecture attempts to link tax compliance and economic development as a veritable concept that needs more attention from the government, saying that “we have neglected the tax system for so long.”
Prof. Eiya, however, recommended that the government should be more transparent and accountable to the citizens in the use of government revenues in general and taxes in particular.
“At best, it will be an illusion for the government to expect individual and corporate citizens to comply with tax regulations in the absence of such transparency and accountability,” he said.
He noted that it is rather unfortunate that the strongest obstacle to voluntary tax compliance by citizens in the country today is the evident lack of transparency and accountability on the part of the government.
