Despite High Taxes, Nigerians Still Provide Water, Electricity For Themselves-AfDB Boss

The President of the African Development Bank, Dr Akinwunmi Adesina has decried the inability of government to provide the basic needs of Nigerians despite collection of taxes.

Adesina, who spoke at the first national tax dialogue organized by the Federal Inland Revenue Services, said that Nigerians pay one of the highest implicit tax rates in the world that is even higher than developed countries.

He said, “We must distinguish between nominal taxes and implicit taxes. Taxes that are borne but are not seen nor recorded.

“Truth be told, Nigerians pay one of the highest implicit tax rates in the world way higher than developed countries.

“Think of it, they provide electricity for themselves via generators; they repair roads to their neighborhoods, if they can afford to; there are no social security systems; they provide security for their own safety; and they provide boreholes for drinking water with their own monies.

“That is incredulous in itself. Boreholes are not the way to provide water in the 21st century. Every household should have pipe borne water.”

Speaking further, he noted that 86 per cent of small and medium sized enterprises in Nigeria spent $14bn annually on diesel for generators, adding that most companies in nigeria loses ten percent average of sales because they do not have access to reliable and affordable electricity.

According to him, governments, over time, have transferred their responsibility to citizens.

“When governments or institutions fail to provide basic services, the people bear the burden a heavy implicit tax on the population.

“The Nigeria economy shrunk by three percent in 2020 on account of falling oil prices and effects of the lockdowns on economic activity. The pandemic has impacted on budgetary balances and increased debt burdens,” he said.

According to him, the AfDB in its African Economic Outlook has projected a 1.5 percent in 2021 and 2.9 percent in 2022 for the Nigerian economy, adding that there is need for Federal Government to focus on corporate taxes and ensure full compliance.

The AfDB president added that small and medium enterprises should be supported through tax exemptions or tax deferments.