Wale Edun, Minister of Finance and Coordinating Minister of the Economy, has revealed that approximately 90 per cent of the tax revenue entering the government treasury originates from just nine tax heads.
Edun stated this during a briefing at the ongoing Spring Meetings of the International Monetary Fund (IMF) and World Bank in Washington DC on Friday.
The Minister noted that although there are around 80 different taxes and levies across Nigeria, only nine of them generate the current 90 per cent of revenue that significantly contributes to the Gross Domestic Product (GDP).
Edun explained that the government’s objective is to reduce the multitude of taxes and properly bill individuals, which will enhance people’s willingness to pay and ultimately increase revenue collection.
According to him, “At 10 per cent to GDP, what should I say? It would appear as if some people are not paying their taxes. Our strategy is to increase the tax revenue without increasing the rate of taxes. We want to deploy technology to make tax collection more efficient. Our analysis has shown that 90 per cent of tax revenue comes from nine tax heads while we have over 80 taxes from federal through states to local councils.”
He stated, “If we eliminate a large number of these taxes and concentrate on the nine that yield the current 90 per cent revenue and deploy technology, there will be more efficiency and we will be able to double our tax revenue in about three years.”
he further revealed that the Federal Government is committed to tackling the issues of excess liquidity by temporarily suspending the use of ways and means from the Central Bank of Nigeria (CBN).
He explained that this action is designed to promote a collaborative synergy between fiscal and monetary authorities to alleviate inflationary pressures and stabilize the currency exchange rate.
