VAT hike’ll impoverish Nigerians, Tinubu tells FG
National Leader of the All Progressives Congress (APC), Asiwaju Bola Tinubu, has advised the Federal Government to shelve plans to raise Value Added Tax (VAT).
He warned that increase in VAT would worsen the nation’s economy. “Consumers’ spending is slipping, and this is where I will stop and appeal to Professor Yemi Osinbajo, the vice president, and his team, to put a huge question mark on any increase of VAT, please. If we reduce the purchasing power of the people, we can further slow down the economy.”
Rather than raise VAT, the former Lagos State governor who spoke at the 11th Bola Tinubu Colloquium, in Abuja, yesterday, advised government to expand the tax net, by capturing more people to pay tax, to generate more revenue. “Those who are not paying now, if it is inclusive of Bola Tinubu, let the net get bigger and we take in more taxes and that is what we must do in the country, instead of the additional layer of tax.” He noted that Nigeria was still in the process of defining itself politically and economically.
During a session with the Senate Committee on Finance, Minister of Budget and National Planning, Senator Udoma Udo Udoma and Chairman of the Federal Inland Revenue Service (FIRS), Babatunde Fowler, had disclosed that the Federal Government was considering an upward review of VAT by at least 50 per cent to enable it fund the N30,000 minimum wage recently approved by the National Assembly. Fowler said the proposed payable VAT by Nigerians, based on the increment, would be between 35 per cent (6.75 percent) and 50 per cent (7.25 percent) as against the five per cent currently being charged on all products in the country.
Tinubu also challenged government to develop new economic ideology that would help Nigeria survive impending global economic earthquake as well as retain the youths. “…Forecasters are predicting a global recession within the next 12-18 months. I render these observations not to frighten anyone but because they ring true. Wisdom requires that we accept reality instead of obscuring it under the cloak of wishful thinking. We must build policies that interact with the world as it is, and not with the world as it should be. “At this point, we must recognise a fundamental truth of our time. The economic model upon which the world is built is unraveling.
The coming downturn is just a symptom of this great upheaval. “The global economy faces either genuine reform or gathering ruin. Because of this, the economic cohesion of western nations is weakening. Income inequality has reached levels unseen in a century. The middle class in most countries is shrinking. “We must recognise these harsh economic tidings as advance warnings to the wise, hence we must think deeper and work harder for our people in Nigeria. “I would be a most wicked friend if I knew a storm was approaching yet convince you to ready your family for an outdoor picnic under the tallest tree.
The truth is always a more valuable guardian than fantasy. “Mr. President, you have warned several times that the storm that approaches is not inevitable. It is borne of a human folly and reckless greed. This means that it can be rectified by human wisdom and prudential action. “Wages stagnate while prices are on a ceaseless march upward. We must amend our basic ideas about the economy. We must divorce ourselves from our fixation with GDP rates and similar statistics. These things were initially intended to be indicators, suggestive measurements. However, we have misinterpreted these road maps by treating them as if they were the destination itself.This has caused us to distort the organic relationship between the people and the economy.”
According to him, the nationa’s pursuit of the Next Level cannot be achieved by blindly following the economic path of other countries. “That would be tantamount to racing to live in a building just as its long-term occupants were frantically rushing out, screaming that the edifice was mean and crumbling. If we are smart, we dare not enter. “Instead, we must construct our Next Level on a progressive ideology and vision that will take our people out of penury, diversify our economy more aggressively and empower and retrain our youths. “To be the great nation we purport to be, we must reform and retool our economy according to our definition of what is best for our own people. We cannot assign that duty to anyone else.’
According to him, to pull the nation from poverty, government must play a decisive role. It must at times direct and even develop markets and opportunities. This is nothing novel. I am only restating what the established economies did when they were young and assumed their trajectories toward growth.”
Lagos State Governor, Akinwunmi Ambode described Tinubu as a man of high political dexterity, dogged leader and man of undaunted courage. He expressed confidence that the APC was spreading its progressive tentacles further into the country, while Nigerians were looking forward to moving to the next level. He said the theme of the Colloquium, Next Level: “work for the people was chosen to coincide with the times when the country was on the threshold of greatness.”
Dignitaries at the event included APC national chairman, Adams Oshiomhole, former ruling party boss, Bisi Akande, Tinubu’s wife, Oluremi, governors of Oyo state, Abiola Ajimobi, Ekiti, Kayode Fayemi, Osun, Oyetola Gboyega, Imo, Rochas Okorocha, Ondo, Rotimi Akeredolu, Zamfara, Abdul Aziz Yari, Bauchi, Mohammed Abubakar, Plateau, Simon Lalong, Edo deputy governor, Philip Shaibu and Lagos state governor-elect, Babajide Sanwo-Onu.
Others include National Assembly members, Ahmed Lawan, Godswill Akpabio, countless royal fathers, including Ooni of Ife, Adeyeye Ogunusi, Ministers of Health, Isaac Adewole, Labour and Employment, Chris Ngige and Trade and Investment, Okechukwu Elelema, among others.