Economists profer ways to boost non-oil revenue

Economists have revealed ways to boost the non-oil revenue in the country.

Nigerian Economic Summit Group (NESG)’s Fiscal Policy Roundtable through its Citizens Perception Report, yesterday, urged government to establish an Office of Tax Simplification (OTS), among other recommendations, to demystify complex provisions in the nation’s tax laws and boost dwindling revenues from the non-oil sector of the economy.

The report, ‘Better Tax’, which is the first of several research reports to be published in support of NESG’s tax reform and advocacy vehicle, seeks to close the knowledge gap in fiscal policy.

It also targets the creation of a sustainable framework to actualise the federal government’s inclusive growth economic agenda.

Launched in Lagos, the report revealed that less than 20 per cent paid income tax in the previous year and only seven to eight per cent paid land use/property taxes or tenement rate, while 59 per cent of adults paid no tax of any kind.

Chairman, NESG Fiscal Policy Roundtable, Dr. Sarah Alade, said the core concept of the roundtable was to reflect the needs and objectives that form the basis of a robust fiscal reform platform focused on mobilising and growing the country’s tax revenue.

According to Alade, the IMF estimates that revenue collected in 2016 across all tiers of government was only about six per cent of Gross Domestic Product (GDP).

Historically, more than 70 per cent of those revenues come from the oil sector, while the non-oil sectors, which account for more than 90 per cent of GDP, contributed about 30 per cent.

“This limits Nigeria’s ability to credibly execute its development plan and fund critical social sector programmes. It also leaves Nigeria very vulnerable to macro-economic shocks from low oil prices. The most recent fall in oil prices threw Nigeria into a fiscal crisis with spillover effect on the economy, resulting in a recession in 2016. Building a strong revenue base that is balanced between the oil and non-oil sectors is therefore critical to sustainably finance Nigeria’s development programme and long-term macro-economic stability.”

Co-chair Fiscal of Policy Roundtable, Dr. Doyin Salami, represented by Pricewaterhouse (PWC) West Africa Tax Leader, and research director of NESG Fiscal Policy Roundtable, Mr. Taiwo Oyedele, said the government had been unable to meet recurrent and capital expenditures following a budget deficit of N3.8 billion and debt profile of N22.7 billion.