“If I toil it is snatched away from me “– Babylonian Proverb, 2300 BC.
The recent call by some organizations, small and large scale businesses to seek for reduction in the rate at which taxes are being leveled on them both by the Federal and State Government has become a daily tune in Nigeria.
Without doubt, tax remains a major source of revenue for the governments around the world. It is no surprise why governments are keen about the safety and productivity of their citizens, as this translates to more taxable persons.
The same applies to companies and businesses, because the more the businesses, the higher the source of revenue for the government.
Although some businesses or organizations are gradually operating at an optimum level even though a few have been running on a higher revenue.
Having recovered from economic recession that almost crippled business activities some years back if taken into context should make the government consider some of the challenges being faced by most of these organizations (be it private or public level).
Besides, some of these organizations face multiple taxation from Federal, State and Local Governments, which have created some sort of burden in terms of fulfilling their yearly obligations.
Some have claimed that since double tax charges are been leveled on them there has been an indirect burden assertion on their finances, thereby causing business transactions to reduce in terms of profit making.
These are areas the government needs to look critically at so as not to cause a total collapse of some vibrant businesses within the country as a whole.
It will be recalled that early this year, The Federal Executive Council (FEC) approved two Executive Orders and five Amendment Bills to the country’s tax policies aimed at reducing tax burden on Nigerians and boosting ease of doing business.
This move became necessary after FEC had on February 1, 2017, approved the revised National Tax Policy in order to have a robust tax system that would promote investment and improve revenue for sustainable national development.
It is in this vein that Members of Lagos Hoteliers Association (LHA), led by President, Prince Waheed Adekunle Akilo had appealed to the Lagos State Government to reduce the Value Added Tax (VAT) been leveled on them in a bid to meet up with the demands of the Federal Government tax level.
he said in his words “It’s very challenging running hotel business in Nigeria, especially in Lagos State. We are being made to pay Value Added Tax (VAT) to the Federal government out of which a certain percentage is given to state government, here we are again, the Lagos State Government is still demanding from us Consumption Tax.
“When the government imposes multiple taxation on small-medium scale industry, local industries will never grow. We are faced with lots of burden, in order to be in business, the governments – both State and local are adding more burden on us with series of levies.
“When the government imposes multiple taxation on business, it affects not only the operators, but by extension, it affects the individual family. We hope we have a listening government in Nigeria, so that anytime we talk to them they listen to us that way we the small-medium scale businesses can survive”.
In addition, Director General/CEO of International Air Transport Association (IATA) Mr. Alexandre de Juniac has called on Nigeria and other African governments to lower the cost of tax for airlines in Africa which has negatively affected the profit of the airlines.
“All regions in the world, except Africa, are expected to report profits in 2018 and 2019,” We must lower the cost of operations for airlines in Africa which has negatively affected the profit of the airlines,” said Juniac.
“the infrastructures has to be efficient and effective because this is a big problem. And the government must also encourage the operation of local airlines not owned by the state,” he added.
“The point is that the buffer between profit and loss is thin and a dollar for a new tax, an increase in charges or shift in oil price can eat away at least $7.75 per passenger profit very quickly,” he reiterated
In all for any economy to have rapid expansion and growth, issues of double taxation have to be critically looked into. “Nobody enjoys paying income tax or taxes, but few people argue that we would be better off without it”