Multiple taxes hinder development and economic growth (NCC).
The Nigerian Communications Commission (NCC) has warned that multiple taxes would hinder economic growth in the country.
Adeleke Adewolu, NCC Executive Commissioner for Stakeholder Management, stated this during a regional stakeholders’ workshop on multiple taxation and regulations in Ibadan, the Oyo State capital.
At the workshop attended by various stakeholders, including representatives of state governments, experts, and telecommunication companies, Adewolu spoke on the theme “Multiple Taxation: An Impediment to Economic Development.”
He regarded multiple taxes as a bane to economic development in the country, stating that the goal of the workshop was to address the problem and find a solution.
Highlighting the National Tax Policy of 2017, which emphasizes the need to eliminate multiple taxation at all levels of government, he stated that taxes similar to those collected by one level of government should not be introduced by another level of government.
He said: “However, before addressing how multiple taxation is an impediment to economic development, it is important to emphasize that taxation, in and of itself, is a veritable tool for economic development.
“The curious question, which this workshop will attempt to answer, is how a fiscal tool for economic development like taxation can become inimical to economic development.
“It is imperative, therefore, to correct some misconceptions about taxation, particularly the misguided notion of taxation as a penal tool against thriving business enterprises.”
Adewolu maintained, however, that taxation is the backbone of public finance since it provides assured and sustainable sources of money for social programs and public investments while also serving as a tool curated by the government to “effectively and efficiently share our commonwealth.”
He articulated: “It is thus evident that taxation is critical for making growth sustainable and equitable. Thus, taxation by design is an instrument for economic development, and it is important to acknowledge and support the initiative of all tiers of government in using taxation as an instrument for socio-economic development.
“However, supporting the tax initiatives by the various tiers of government includes indicating where a category of taxes has become cancerous to economic development. These types of taxes typically manifest themselves in the form of multiple taxes, and by design, they reverse growth, stifle innovation, and discourage investment. In parabolic terms, they are the scarecrows mounted by the government to disincentivize development.
“It is pertinent to note that the National Tax Policy 2017 emphasizes the need to eradicate multiple taxation at all tiers of government. Specifically, the policy states that taxes similar to those being collected by one level of government should not be introduced by the same or another level of government.
“The federal, state, and local governments shall ensure collaboration in harmonizing and eliminating multiple taxations.”
He emphasized that the paradox of multiple taxation is that it does not increase government revenue, and the crippling effect of taxes is that it makes otherwise profitable businesses unprofitable, reduces the tax base, encourages tax evasion, and complicates tax compliance.