Tweeting on Monday, Moghalu said the recommendation by IMF would not solve Nigeria’s economic crisis.
By Jeffrey Agbo
Former deputy governor of the Central Bank of Nigeria (CBN), Prof Kingsley Moghalu, has expressed his disapproval of the call by the International Monetary Fund (IMF) for Nigeria to raise taxes.
In its latest Fiscal Monitor titled ‘On the path to Policy Normalisation’ released last week during its joint spring meetings with World Bank, IMF said that Nigeria’s debt is projected to keep rising and that necessary steps must be taken to generate needed revenues.
“In general, what we are saying about Nigeria is the need for a medium-term plan to reduce debt vulnerabilities over time and it is because Nigeria has very low tax revenues. So, that makes it more vulnerable to these types of shocks and tightening global conditions,” IMF’s Division Chief for Fiscal Affairs Department, Paulo Medas, said.
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Tweeting on Monday, Moghalu said the recommendation by IMF would not solve Nigeria’s economic crisis.
“What we need is more efficient and more widespread tax collection. Millions who should pay taxes don’t. Then we need to spend better, curb waste and corruption,” he tweeted.
“We need to spend more on things that yield economic dividends. And then we need to consider a ‘Wealth Tax’ where the extremely wealthy pay their fair share as is the case in developed countries. Finally, we should end the regime of ‘waivers’ that give wealthy businesses trillions.
“Tax breaks. We have tax collection, revenue generation and revenue allocation/spending problems, not tax increase problems. Of course, many avoid paying taxes because they simply don’t trust the government. Trust must be restored in a verifiable manner, with increased transparency.”