I was discussing with
Gilbert Alasa, a PR executive and I asked his opinion on what tax should
achieve in the society. He gave an expected reply: “In my estimation, when I pay tax, I am
investing in Nigeria. My expectation is to see that investment reflected in our
schools, our rail system, our bridges and also preserve our natural resources and ensure my
safety.”
He
goes to add: “I want government to use my tax to foster a social value chain
that supports my dream and my ability to compete and hold my own anywhere in
the world,” he concluded. A lofty ideal isn’t it? Does it appear to be an elusive concept? It should not be if we happen to get our acts
right.
Again
I went on to ask another friend, Femi Olutade, an online retailer who in recent
time has been consumed with a passion to see accountability on the part of the rulers
to the ruled. He expressed his views thus: “Tax is not a charity or a free gift
but a way of giving to the government. It is part of our income to develop the
country, so if tax is not used for the intended purpose, it cannot be
justified.”
It happens that many times when we don’t get
value for service and the government does not provide an enabling environment
for the enjoyment of our civil, political and economic right, we are wont to
lament “but I pay tax”? In as much as that is an aspect of justifiable
lamentation, there is an aspect of tax justice we are not paying much attention
to, which in my own reckoning boast of more dividends for development in Sub-Sahara
Africa. This is the tax holidays granted
foreign investment by the government of most African countries.
So we have seen the furor generated over the 2016 budget in
Nigeria and the anger with which tech savvy Nigerians condemned some of the
items proposed in the inflamed budget of “change.”
I believe this type of “holy anger” unleashed on the budget
would go a long way in creating the change we want to see if we can pursue tax
justice on foreign investment with the same vigour. There is no better time
than now to pay attention to the tax policy included in some of the foreign
investment operating on our soil. If we don’t,
poor individuals risk being overtaxed in this period of austerity where even
recharging a phone through online bank transaction carries a tax duty.
Albeit, at this juncture, I believe it is best to raise some
bullets on why we should place a premium on tax justice for foreign
investment. This brings me to the whys:
· *** Because Nigeria lost US $3.3billion as a result
of an extraordinary ten year tax break granted by the Nigerian government to
some of the world’s biggest oil and gas companies namely Shell, Total and
ENI. ( if in doubt, read the ActionAid
report titled Leaking revenue: How a big tax break to European gas companies
has cost Nigeria billions).
· *** Because US$3.3 billion is the equivalent of twice
the Nigerian healthcare budget for 2015 in a country where 15 out of one
hundred children die before their fifth birthday.
· *** Because an 11 months old investigation by
PREMIUM TIMES revealed that the telecommunication giant, MTN shipped billions
abroad, paying less tax through a complex but notorious tax avoidance scheme
called Transfer Pricing.
Back to the matter - tax justice! If there is a time
Nigerians ought to pay active attention to the issue of tax justice, it is now.
Now that price of oil has dwindled in
the international market. Now that austerity times are here, because of falling
oil prices. Now that the debate on alternative revenue sources has suddenly
acquired a strident and interesting tone with one of our senator, Chief Whip Olusola Adeyeye (APC Osun Central)
saying we should turn to taxing farmers, text messages and beverages to fund the budget.
We should pay attention to tax justice as much as we do to
European football leagues and entertainment trends. The perils of these times
demand it. We all should join hands to demand that tax incentives must be based
on a thorough analysis and a proper assessment of the impact on poor and
vulnerable groups. Let’s demand that consortiums for foreign investment should be
made open for scrutiny and public deliberation. Aside being one of the oldest
ways to redistribute wealth, tax is the most sustainable way to finance public
expenditure. For this, tax justice should be important to us. Place a premium on it!
