Tax revenue in Nigeria is minimal, according to Bill Gates, co-chair of the Bill and Melinda Gates Foundation. Tuesday in Abuja, Gates made this statement during a Pan-African youth nutrition dialogue.
The American business billionaire is reportedly in Nigeria for several events, BrandSpur business and economy news reports.
During the occasion, Gates stated that it is difficult to sufficiently fund important sectors like health and education because of the poor tax collection. According to him, there needs to be a commitment to making sure that the funding of health programs is properly managed if people are to have faith in the government’s capacity to provide high-quality healthcare.
He stated: “Over time, there are plans for Nigeria to fund the government more than it does today. The actual tax collection in Nigeria is actually pretty low.
“If citizens want the education and the health things, as they develop the confidence that these programmes can be very well run, and our foundation is involved with a lot of the exemplars that are showing the way in terms of making sure the money is spent really well, running a very efficient primary health care system where the employees are doing great work, the centres are where they should be, you don’t have underloaded centres or overloaded centres.
“It’s exciting that we are driving the credibility of those health programmes and so that the citizens will feel like primary health care is amongst the priorities that should be very funded as you get some fiscal flexibility,” he added.
Continuing, he went on to say: “We have significant issues in our tax revenue. We have issues of revenue generally which means tax and non-tax. You can describe the whole fiscal system in a state that is in crisis.
“When my committee was set up, we had three broad mandates. The first one was to look at governance: our finances as a country, borrowing, coordination within the federal government and across sub-national.
“The second one was revenue transformation. The revenue profile of the country is abysmally low. If you dedicate our whole revenue to fixing roads it will be insufficient. The third is on government assets,” he added.
Speaker further, he disclosed: “The law we are proposing to the National Assembly has the rate of 7.5% moving to 10% from 2025. We don’t know how soon they will be able to pass the law. Then subsequent increases are also indicated in terms of the year they will kick in.
“While we are doing that, we have a corresponding reduction in personal income tax. Anybody that is earning about N1.5 million a month or less, they will see their personal income tax come down. Companies will have income tax rate come down by 30% over the next two years to 25%. That is a significant reduction.
“Other taxes they pay are quite many: IT levy, education tax, etc. All these we are consolidating into a single one. They will pay 4% initially. That will go down to 2& in the next few years,” he said.
