The Chartered Institute of Taxation of Nigeria (CITN) says the low level of tax compliance in the country is due to trust deficit between citizens and the government.
Adesina Adedayo, CITN president, said this on Monday at the 5th annual international academic conference on taxation at the Kwara State University (KWASU), Malete.
The conference, scheduled to last for two days, was organised by CITN in collaboration with KWASU, and is themed ‘taxation and socio-economic development’.
Adedayo said citizens do not trust the government to channel tax revenues for its intended purpose.
According to him, low awareness among citizens about their tax obligations, poor management and accountability of tax revenue by the government and lack of a comprehensive database of taxable persons in Nigeria, were also responsible for poor tax compliance.
He said the theme of the conference was apt and timely as the country was currently overburdened by huge financial debts amidst poor economic and infrastructural outcomes.
“Moreover, the government’s expenditure has continuously grown above her revenue base, thereby, impeding capital formation,” he said.
“It is saddening that, as at today, Nigeria’s tax revenue mobilisation performance remains below her capacity as the largest economy in Africa with one of the world’s largest population.
“The current number of people captured in the Nigerian tax net is grossly inadequate for a nation that desires to achieve development in the foreseeable future.”
Adedayo said for the situation to change, policymakers, and relevant stakeholders must continually review the existing national frameworks through critical thinking, deliberate harmonisation of such thoughts and effective implementation.
“With this background, I can assure that by the end of this conference, all stakeholders will be better informed in developing workable strategies towards improving Nigeria’s tax revenue performance for sustainable social and economic development,” Adedayo said.
The CITN boss further assured that the institute would pursue the implementation of the very relevant recommendations to the best of its capacity.
In his remarks, Mustapha Akanbi, vice-chancellor of KWASU, said the theme was timely and of immense importance given the role of tax in the socio-economic development of any nation.
“You will recall that in order to boost the IGR, and curb tax evasion and avoidance at all levels, the federal government increased its VAT rate from 5 percent to 7.5 percent and introduced the Finance Act in 2020,” he said.
“These measures have not really solved the problem of the country’s socio-economic development.
“Currently, debt servicing gulps almost 100 percent of the revenue generated while misappropriation of public funds, high insecurity and crime rate, among others, continue to undermine efforts at development.
“I hope that the outcome of this conference will contribute meaningfully to the on-going efforts by the government and other stakeholders in promoting socio-economic development of the nation”.
Also speaking at the conference, Shade Omoniyi, chairman, Kwara Internal Revenue Service (KWIRS), said the state remained committed to providing an enabling environment for business to thrive, which will in turn improve the state’s internally generated revenue (IGR).