Source: This Businessday live
The Nigerian Association of Chambers of Commerce, Industry, Mines, and Agriculture (NACCIMA) and the Organized Private Sector (OPS) have voiced apprehension about the adverse long-term effects of arbitrary taxation on businesses and the nation’s economy.
At the 45th Trade Fair hosted by the Kano Chamber of Commerce, Industry, Mines, and Agriculture (KACCIMA), NACCIMA President Dele Kelvin Oye highlighted the negative impacts of high taxes, stating that they stifle innovation, discourage investments, and threaten the sustainability of businesses.
Oye called for an urgent review of sections of the 2024 Tax Bill, pointing out provisions that harm businesses, particularly those operating in free trade zones. He appealed to the Federal Government to adopt a more inclusive and strategic approach to taxation policies to avoid destabilizing critical sectors of the economy.
He stated, “As Margaret Thatcher warned, we should be wary of high taxes. High taxation restricts the power of the people while giving more authority to the government. As we strive for economic prosperity, I must also draw attention to the issue of arbitrary taxation. I urge all levels of government in Nigeria, especially state and local governments, to consider the long-term implications of high taxation on businesses.
“High tax burdens can stifle innovation, deter investment, and threaten enterprises critical to our economic growth. Let us work collaboratively to create a business-friendly environment that encourages entrepreneurship and fosters economic development.”
Concerns Over Free Trade Zones
Discussing free trade zones, Oye congratulated the board and management of the Dala Economic Zone but urged President Bola Ahmed Tinubu to consult with the organized private sector and stakeholders before implementing significant economic policies.
He specifically requested the Federal Government to reconsider and withdraw the approval of a memorandum dated October 20, 2024, authored by the FIRS Chairman. The memorandum, he argued, failed to acknowledge the legal foundation for free trade zone incentives established in 2002 by President Obasanjo under Section 23(s) of the 2007 Companies Income Tax Act (CITA).
Oye urged the government to take immediate actions, stating:
“We urgently call upon the Federal Government of Nigeria (FGN) to take the following actions: Expunge Sections 60, 198(2), and 198(3) from the bill; exclude free zone enterprises from the scope of Section 57 of the bill; and delete the current Second Schedule of the bill in its entirety, which was inserted into the tax bill 2024.”
Theme of the Trade Fair: “Non-Oil Export for Economic Prosperity”
Addressing the theme of the trade fair, “Non-Oil Export for Economic Prosperity,” Oye emphasized its importance in achieving sustainable economic growth. He noted that the diversification of Nigeria’s export base is essential for navigating the ever-evolving global economy.
He stated, “The future of our economy undeniably lies in the diversification of our exports, and it is imperative that we rally together towards this goal.”
Strategies for Expanding Non-Oil Exports
Oye also outlined actionable strategies for enhancing the country’s non-oil export potential. He urged the government to take deliberate steps to open market access for non-oil exports through strategic policies and programs that link local producers to international markets.
He proposed, “The government must take deliberate and proactive steps to create market access for non-oil exports by implementing strategic policies and programs that connect local producers to global markets. Establishing trade offices in key export destinations can promote Nigerian products and facilitate business linkages.”
Oye’s recommendations aim to foster a more diversified economy and promote sustainable growth through an expanded non-oil export base, while also addressing the challenges posed by arbitrary taxation and policy inconsistencies.
