We’re developing dynamic tax system to fund budgets- Buhari

President Muhammadu Buhari, has explained that the nation was developing a dynamic tax system that would become formidable source of funding government budgets and programmes as part of the administration’s efforts to diversify the economy from over dependence on oil.

Buhari, who disclosed this while declaring open the 18th annual tax Conference, organised by the Charted Institute of Taxation of Nigeria, CITN, in Abuja, regretted that over dependence on the oil revenue in the recent past was the root causes of the country’s current situation.
The President, who was represented by the Minister of Finance, Mr. Kemi Adeosun, however reassured that the administration has developed a comprehensive and realistic strategy to solving the problem.
According to Mr. President, “More importantly we have developed a comprehensive and realistic strategy to solving the problem in a sustainable way that will build term opportunity and prosperity for our people.

“Once the current oil price is low it is instructive to note even when the oil prices reached historic height of as much as $115 per barrel, Nigeria did not significantly benefit in terms of economic growth and this could largely be attributed to a number of factors which includes but are not limited to corruption, wastage, inefficient spending as well as revenue leakage.
“Oil revenue was an effective anesthetic that have scaled the effects of fundamental weaknesses in our public financial management which we must now address.
The low level of tax revenue in Nigeria 7 per cent, is a key factor in and also a symptom of our fundamental over reliance on oil that has resulted in the fiscal imbalance that are now manifesting.
“It is therefore an appropriate decision by the chartered institute of taxation to theme this year’s conference fiscal challenges and opportunities in the Nigerian economy.
In preparing for this event, I carefully read the communiqué arising from the last tax conference held last year and I acknowledge the remarkable insight of the diagnosis that “Nigeria is experiencing growth without development” and I would with your permission frame my comment of the recommendations made last year to the government by this institution and identify how to address them.
“These were your recommendations to the government and I summarise: “Government was advised to redraft the tax laws and in particular to amend areas of the company’s incomes tax that now impose double taxation.
To remove the minimum tax requirements that potentially forces loss making companies to pay tax from capital. “I think the CITN set out very clearly the fiscal priorities to underpin our economic agenda in a very concise manner.
I will explain briefly our road map for the attainment of these objectives. “We believe that a robust tax system is a prerequisite for any economy that is serious in its commitment to growth and development.
Tax collection must grow in line with growth in the economy. But sadly this has not been the recent case in Nigeria and this is our challenge.
“Our tax system must reflect the nature of our commercial activity levels. Oil is 13 per cent of our GDP level but it represents a disproportionate share of our tax revenue.
The challenge is the other 87 per cent of our GDP why is it contributing so little to government revenue?