Several financial experts have voiced their support for the Federal Government’s proposal to impose additional taxes on wealthy Nigerians, citing it as a means to enhance the country’s fiscal revenues and promote income redistribution. In separate interviews with the News Agency of Nigeria (NAN) in Lagos, these experts provided their insights.
“The government proposal is a welcome idea,” stated Dr. Muda Yusuf, the Chief Executive Officer of the Center for the Promotion of Private Enterprise (CPPE). He explained, “This approach is a form of progressive tax, because high-net-worth individuals are expected to pay more taxes. It is a means of income redistribution and a common practice in most civilized countries where there is economic development.” Dr. Yusuf also criticized instances where affluent citizens underpay their taxes, stating, “Their tax remittance is not commensurate with their net worth and affluent lifestyle. They often short-change the government.”
Dr. Mc-Antony Dike, a former President of the Chartered Institute of Taxation of Nigeria (CITAN), emphasized the constitutional nature of the government’s proposal. He noted, “Our tax laws dictate that every Nigerian who earns an income, whether legitimately or otherwise, must pay their tax. Indeed, the Personal Income Tax Act 2011, as amended, removed the exemptions it granted to the President of the Federal Republic of Nigeria. Anybody who earns legitimate income legitimately must pay tax.” Dr. Dike also pointed out the consequences of wealthy Nigerians avoiding tax, stating that it denies the government the revenue needed to provide public utilities.
Mr. Godwin Anono, the President of the Standard Shareholders Association of Nigeria, regarded the federal government’s proposal as a novel initiative aimed at reducing economic inequality. He explained, “The planned policy is a sort of reduction of economic inequality in our society, where the elite are expected to take care of economically vulnerable citizens through their taxes.” Mr. Anono also recommended that the federal government employ technology to expand the pool of eligible taxpayers.
NAN reported that the Federal Government has outlined its plan to begin taxing wealthy Nigerians in pursuit of an 18 percent Tax-GDP ratio revenue target. This information was disclosed by Mr. Taiwo Oyedele, Chairman of the Presidential Committee on Fiscal Policy and Tax Reforms. Mr. Taiwo noted that this move is aligned with President Bola Tinubu’s reform agenda, as the federal government aims to achieve an 18 percent Tax-to-GDP ratio within three years. He added that the plan is designed to enable the wealthy to contribute more in taxes for the benefit of the less privileged. Additionally, there is a vision for a reduction in the corporate income tax rate, currently above 40 percent, to stimulate business growth.