The Centre for the Promotion of Private Enterprise (CPPE), has raised the alarm that Nigeria’s current tax regime is stifling investment in the country.
CPPE Director, Dr. Muda Yusuf, noted that an economy that desires job creation, economic inclusion, investment growth and poverty reduction, should have an accommodating tax regime for investors.
According to him, “Corporate tax in Nigeria is 30%. But effective corporate tax is much more than that. There is tertiary education tax of 2.5% of profit; NITDA Levy of 1% of profit; NASENI Levy of 0.25% of profit; Police Trust Fund Levy of 0.005% of profit. This brings effective corporate tax to about 34%. This rate is one of the highest in the world. Average corporate tax rate for Africa is 27.6%; Asian average is 19.52%; European Union is 19.74% and global average is 23.37%. Meanwhile new taxes are still being proposed by the National Assembly. These include Tertiary Health Tax of 1% of profit; and NYSC levy of 1% of profit. There are numerous other taxes imposed on businesses by the states and local governments.”
“Others are acceleration of the implementation of single window system in order to minimise human interface at the ports; review of the current call up system with a view to making the system efficient and less vulnerable to corruption and extortion; introduction of credible, independent and speedy Dispute Resolution System between the service providers, government agencies and importers; installation of scanners at off dock terminals and border posts across the country; fixing the traffic constraints on the Lagos ports corridor to improve access to the ports; need for prompt decision on the renewal of Port concession agreements”.
“The political environment has a major impact on economic and business performance. Therefore, the quality of the political transition process, especially the credibility of the 2023 elections would be of contextual significance for the economy in 2023. The elections must be free, fair, transparent and credible. And it must be seen to be so. This underlines the need for the independence, neutrality and credibility of the key institutions involved in the election management process – INEC, Judiciary and the Security agencies. The quality of the democratic transition and choices would significantly impact economic outcomes in 2023.”