The chairman of the presidential fiscal policy and tax reforms committee, Taiwo Oyedele has proposed that the federal government exclude people that are vulnerable from paying taxes.
Mr Oyedele spoke on Politics Today, a Channels TV program on Friday.
“Sadly, the system we have today is trying to tax everything and everybody. You know, if it moves, tax it; if it moves again, tax it even more. That seems to be the approach we have today,” he said.
“You would imagine that those who are selling sachets of water, which we call pure water, how much possibly can be their capital plus profits.
“With all the hard work, people are just trying to see if they can find N800 or N1,000 a day to take care of themselves and their families, which would cover their transport or feeding.
“But when we were speaking to market traders associations, they told us that these guys are paying about six to seven different levies every single day, and they give them some form of sticker.
“And that clearly is not acceptable. We’ve also seen truckers who are moving produce, including food, from one state to another have to pay more than N450,000 in one single trip. Sometimes the stickers add up to more than 50.
“So at the end of the day, this is the reason why, for example, if you looked at the last inflation numbers, even just between rural areas and urban areas, the difference in inflation is about 500 basis points, which is about 5 percent, which you can only just explain by way of transportation but by the time you add the taxes to it.
“You see, that is one of the reasons why that differential is so significant.”
According to the chairman, other decent societies have implemented these measures and it worked for them.
Oyedele said that this method would tackle tax evasion and stop people from breaking the law.
“So we think that the approach to adopt is to exempt some of these vulnerable people, including [the sellers of] sachet pure water,” he said.
He further said that the federal government need to stop asking people how much they earn in order to tax them.
“We also believe that we should stop asking people how much they earn so we can tax them, we should first support them to be able to grow and create wealth, and then use intelligence to tell them how much they have earned,” Oyedele said.
“So that way, we are sure that evasion and people who try to live above the law are a thing of the past. That’s how the decent society that we aspire to be like has been able to develop economics.”