Manufacturers laud FG’s tax reforms, urge crackdown on illegal levies

The Manufacturers Association of Nigeria (MAN) has commended the Federal Government for introducing four executive bills aimed at reforming tax administration in the country while calling for an end to the unlawful activities of non-state actors.

MAN made the call on Thursday during the second day of the public hearing on the tax bills in Abuja, organised by the House of Representatives Committee on Public Finance.

Speaking at the event, the President of the Association, Mr Francis Meshioye, described the tax reform initiatives as timely, noting that their effective implementation would improve the nation’s fiscal and tax administration system.

He said, “The tax bills are timely, and we believe that the implementation of these reforms will bring about new expectations in tax administration across the country. However, we hope that the arm-twisting tactics of non-state actors will become a thing of the past.”

Hitherto, the chairman presidential committee on Fiscal Policy and Tax Reforms, Taiwo Oyedele had  said that the new tax policies will enable manufacturers and small business operators to grow the economy, thereby increasing tax revenues for the government.

He said that the government prioritised small businesses in the recently gazetted Withholding tax and Value-Added Tax regulations.

“We prioritised manufacturers and SMEs in our reforms. Now, there are no taxes on manufacturers anymore,” he said.

“When we withhold your income, and you’re borrowing at 35 percent, it means you’re funding the government at 35 percent. How do you grow? We’ve done the same for VAT, this allows their costs to go down,” he added.

Recently, the FGN published a set of regulations on Withholding taxes and Value-Added Tax, exempting a category of business owners and manufacturers from tax deductions.

The regulation exempts SMEs with an annual turnover not exceeding N25 million, which is N2 million in a calendar month.

It also exempts businesses in manufacturing, agriculture, and other production activities regardless of their turnover.

He further stated that the government is focused on developing a system to automatically get the right people to pay taxes rather than taxing low-income earners.

“One of our focuses is getting people to pay taxes, particularly people on the higher end. We discovered that about 90 percent of people who pay taxes have no business paying taxes.”

“So we are developing a system that uses an ID using the National Identity Number for individuals, the RC number with CAC for businesses, and all economic activities will be linked to that ID.”