The Charted Institute of Taxation of Nigeria, CITN, has canvassed for a more simplified tax administration to enhance voluntary compliance to tax laws.
President of the institute, Dame Gladys Olajumoke Simplice defended this during the in 29th Annual General Meeting, AGM, of the institute that held in Lagos.
According to the President, the year 2020 under review saw the global economy hit rock bottom due to COVID-19 pandemic and fuelled by several other factors in Nigeria.
She stated therefore that taxation remained one of the fiscal policy instruments being looked up to for stability post-pandemic era.
She said, “Before the onset of the COVID-19 pandemic, the Nigerian economy was projected to grow by 2.1% in 2020 by the World Bank. The National Bureau of Statistics (NBS) however reported the overall annual growth of real GDP in 2020 to be at –1.92%, showing a decline of –4.20% points when compared to the 2.27% recorded in 2019.
“With decline in global demand for crude and products, the average oil oroduction declined to 1.61 mbpd against 1.79 million barrels per day (mbpd) recorded for 2019. In the same vain, the average price of crude stood at $42.89 per barrel (pb) against $64.16pb recorded at the end of 2019.
“Other impacting factors that challenged the year 2020 included the rising in inflation rate which averaged 12.98% against 11.39% in 2019; External Reserves (End Period) declined to $34.85bn against $38.60bn while average FAAC allocations stood at N648.44bn against N678.9bn for the preceding year.”
Given this negative trend, Simplice warned against any policy that would over stretch tax payers in economy recovery efforts.
Instead, she said, “Government must avoid the propensity to introduce earmarked taxes to raise revenues while neglecting the impact that such action would have on businesses and economic activities.
“The thinking of Section 2.2.6 of the Revised National Tax Policy 2017 is that our “taxes should be few in number, broad-based and high revenue-yielding”. In effect, the administration of taxes should be simplified for ease of enforcement and compliance.
She noted that the Institute had been proactive in the area of tax advocacy and education to strengthen tax collections and achieve 100% funding of the nation’s budget.
While she hailed the institute’s inputs in the amended Finance Act, she also charged members to continue to strive to achieve ease in tax administration.
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