Taxes paid to the government by citizens, directly or indirectly, constitute the government’s major source of revenue for driving its operational and administrative responsibilities.
As citizens buy goods and services daily for their upkeep, they unconsciously pay taxes relating to the value of the goods they consume and the value added to it, in the form of value added tax. These are often paid without much ado.
However, for direct taxes, ranging from personal income tax to property and asset taxes, government and citizens, especially in less developed countries like Nigeria, are often in constant mutual antagonism. The underlying factor has always been a feeling of deprivation on the side of the citizens who often believe that the government does not justify the tax funds entrusted to them.
Government on the other hand, in a bid to secure citizens’ compliance to prescribed tax payments, more often, employs stringent measures such as localized legislations, coercion and punitive fines without taking cognizance of the universal principles of convenience, simplicity, economy, equity, certainty, flexibility and stability which should guide tax policies. In so doing, the government and its agents does elicit resistance from the citizens, and the fights that usually ensue in most cases, have led to some fatalities.
In Ebonyi State, the case is not different. Almost on a daily basis, tax contractors or their agents are seen viciously struggling with big, medium, small and micro business owners as well as individuals over one form of tax or the other. Most small, micro business owners and petty traders in the streets, in order to evade these agents and their tax “wahala,” have resorted to closing their shops during the day and trading from the late evenings to the night. Those who could not cope, including some big businesses, have either closed down or relocated from the state.
It was for those reasons, and commitment to forging a more cordial tax administration in Ebonyi State for the ensuing year, that the Ebonyi Tax Summit 2021, under the Nigeria tax Justice and Governance Platform was convened, precisely on December 22.
Tax Justice and Governance platform, a national platform of Civil Society Organizations advocating for fair taxes in Nigeria works in the 36 states of the federation.
The Ebonyi summit 2021 was organized in collaboration with Civil Society Legislative Action, CISLAC, supported by Oxfam, and hosted by Neighborhood Initiative for Women Advancement (NIWA), a member- Civil Society Organization, in partnership with the Ebonyi State Ministry of Commerce, Industry and Business development.
The summit brought together representatives of the Ebonyi State Chamber of Commerce, Industry, Mines and Agriculture (EBCCIMA), State Export Club, Market women and other key stakeholders to a round table with government representatives: State Internal Revenue Service, Revenue Appeal Commission, Federal Inland Revenue Service (FIRS), among others. Grievances were shared and clarifications made in order to strike mutual understanding.
Part of the grievances expressed by the taxpayers included alleged multiple taxation, overlapping taxes, over assessment, lack of adequate information, cumbersome procedures, and the uncivilized manner by which tax drivers in the State approach the payers. The payers also condemned government’s use of untrained contractors and their agents instead of professionals and career civil servants in the drive for taxes, identifying it as responsible for the importunate behaviours associated with tax collection in the State.
Speaking on the essence of the summit, the Executive Director, NIWA, Nancy Oko Onya explained: “Tax Justice and governance platform is a national body that talks about fair tax, just tax; encouraging citizens to pay tax, and demanding the government to utilize whatever taxes paid to serve the people by providing services for the people.
“We do tax education; we try to encourage the government to open up spaces for people to do business so that when these businesses thrive, people will also willingly pay tax without coercion.
“Tax payers are crying so much: we are taxed arbitrarily, multiple taxing; government pushing us out of business, so much to pay, and all that.
“And when revenue collectors come to collect tax, they beat us, and all kinds of allegations.
“The government on the other hand is saying: we don’t do all these, without knowing probably, that the contractors they engage to collect taxes, engage touts who could do all those things.
“So, we just created this forum for them to interface, to understand themselves better.
“If government can really educate those contractors properly so they can do the right thing, people will be willing to pay.
“And some of the people were of the view that if they can pay instalmentally, knowing about the economic situation in the nation now, they will pay comfortably.”
The Executive Director harped on the need for tax education and provision of working materials for tax workers. She noted that Government, by using contractors to collect taxes, loses revenue through bribery and corruption.
She added: “The revenue collectors should be properly educated so that as they go for their revenue drive, they will also educate the citizens.
“The issue with contractors is that if they engage these people who are not educated, not professional tax collectors.
“Individuals can take them aside, give them little bribes, and they will forget about collecting the official tax they are meant to collect.
“Government, as such, will be losing from that angle.
“And government will also be losing in that they are paying revenue collectors who are not doing anything.
“If the civil servants who the government is paying are the ones collecting revenue, you will see that people will be able to identify who is coming to collect the revenue.
“Secondly, they will be able to actually say that they are returning the money to the government.
“So doing, the citizens will be able to police the system, knowing that the collectors are people they know; people working in government; people with identity, and they will be willing to pay.”
Summarizing the position of taxpayers in the State, the Director General of Ebonyi State Chamber of Commerce, Hyacinth Uguru, noted that inasmuch as the chamber was not advocating for abolishment or evading of tax payments, government should streamline and make clear the taxes paid in the state for certainty and sustainability.
Describing the summit as a welcome development, he prayed that it should continue to be held intermittently to avoid the gaps in knowledge breeding misunderstanding between the paying public and government.
Uguru stated: “My impression is that they are now seeing what we have been saying.
“It is a step towards answering our cry, that the taxpaying public in Ebonyi State should be enlightened on what tax to pay, how it should be paid; what are the offenses and punishments, and what are the options: is it just sealing their businesses or do they have option of staggering the payment?
“Those are the things we asked, and they promised to look into it.
“They should also mount a more encompassing tax education for the paying public.
“Most people do not know what taxes to pay and how to go about paying the taxes.
“Those who know are complaining about the procedure: You go to the office, get a tax assessment, you go to the bank to pay, go back to the office, and so on and so forth.
“It is so cumbersome, and the money one spends in doing all these may even surpass the tax paid, including other risk factors and time wasted, which may take up to two or more days.
“Let them make the tax payment less cumbersome to the payers.
Uguru, a lawyer by profession, also advocated that the citizens be carried along in the process of devising the tax law.
“So, this is a new beginning, and we are asking for more of this meeting: town hall meetings, public hearings, radio and television programmes, and even consultations before the tax laws are made, so that the one who is paying will be part of the system.
“We are not opposing tax in any way, but how to go about it is what we are concerned about.
“Tax should be defined to avoid multiple and overlapping taxation in such a way that the payers should know the boundary between what the federal and the state collects and those of the local governments, and so on.”
He further condemned the use of touts to drive taxes: “We don’t like the approach of these tax contractors.
“Most of them use touts who cannot even answer questions asked by taxpayers; all they want is money.
“If you must use a contractor, engage a professional to supervise them there in the field.
“Now, governance has gone digital, and we are not supposed to be using touts again.
“We abhor touts.
“Government should use trained civil servants and professionals.”
Meanwhile, the Group Head, Collections, Ebonyi State Internal Revenue Service, Ogbonnaya Ugwu, in an interview, debunked some of the allegations.
He maintained that most of the misgivings were common when it comes to issues of paying taxes by the public. According to him, the complaints often emanated from ignorance about tax policies on the part of taxpayers.
He stressed that Ebonyi State government under Chief David Umahi has justified, and continues to account responsibly for all tax revenue received from the citizens through unprecedented infrastructure and general development indices evident in the State.
Ugwu argued: “I can tell you that as far as tax is concerned, there will always be complaints.
“Most times, people raise unnecessary alarms where there should be none, and I must also tell you that from Adam, people are not comfortable paying taxes, more so, when they feel that they are not seeing the dividends from paying such taxes.
“In this area, Ebonyi State is an exception because even a blind person can see, and agree with me that the taxes that are paid are being used very judiciously.
“Needless to bore you with the infrastructural developments which the tax payers money are used to achieve in the State, under Governor Umahi.
‘On the allegation by some members of the public that there is double taxation, my answer to that question is very simple and will always be in the negative because what people consider as double taxation may not always be it.
“The truth is that people don’t understand how tax operates, and instead of seeking proper explanation, they will indulge in blackmail of the government; even the tax administrators themselves.
“Take for instance, when one has a business and needs to pay for business premises and also needs to pay for his personal income tax as captured in the tax law.
“If such people, not knowledgeable in tax administration, pay, say business premises, they would complain of double taxation whenever they are demanded to pay personal income taxes.
To that extent, I will assure you that there is no double taxation operating in Ebonyi State.”
Striking a balance further in the discourse, the State Commissioner for Commerce, Industry and Business Development, Dr.Stephen Odo, in his address, admonished the taxpaying public not to see government tax agents as evil but as partners in the development of the State.
He encouraged them to always feel free to channel their grievances to the Revenue Appeal Commission established by the State government for proper attention rather than take laws into their hands, adding that he would make the interactive forum a periodic event to continually strengthen understanding between the parties.
It is believed that with the communiqué raised at the end of the summit which contained the commitments and pledges of the parties, including the need for proper book keeping, need for the public to avail themselves a copy of the tax law; need for some administrative adjustments in the mode of tax administration in the State, among others, there would begin to exist a more cordial relationship between the government and the taxpaying public in Ebonyi State: the dream of all well meaning citizens.
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