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Business News of Saturday, 1 October 2022

Source: guardian.ng

Nigeria forfeits N16.4tr in tax revenue in three years, coalition laments

Tax file photo Tax file photo

A coalition of civil society organisations has lamented that the federal government forfeited N16.4 trillion of its revenue between 2020 and 2022 despite its huge fiscal deficit.

A breakdown revealed that in 2020, the total forgone tax revenue was N5.6 billion while it was about N5.5 billion in 2021. This year, another N5.3 billion, tax revenue has been forfeited.

The stakeholders raised concern that the proposal in the 2023 budget to give away N5.2 trillion, against projected revenue of N8.45 trillion while incurring an N11.3 trillion deficit cannot be reconciled under the fiscal responsibility laws.

The coalition, including Centre for Social Justice, Action Aid and Christian Aid, disclosed this during a media briefing on their recommendations on the,2023-2025 Medium-Term Expenditure Framework and Fiscal Strategy Paper (MTEF/FSP).

The group said there is a need to amend the Finance Act 2022 to remove the power to grant tax expenditures from the minister.

They added that tax expenditures should not be more than 10 per cent of projected revenue within the medium term.

The Lead Director Centre for Social Justice (CSJ), Eze Onyepere, while reading out the recommendations, said the federal government could reduce its N11 trillion budget deficit and still save N3 trillion by cutting extant fuel subsidies by 50 per cent.

He also urged the government to stop crude oil theft, which fritters away 400,000 barrels daily, leading to a $1.2 billion loss per month or $14.4 billion yearly.

The coalition further pointed out that reducing the tax expenditure proposal by 90 percent will free up at least N4 trillion in revenue, adding that the mandatory use of the Treasury Single Account (TSA) by all government-owned enterprises would increase FG’s revenue by N1 trillion.

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