VAT Increase Will Lead to Economic Difficulties, Tinubu Warns FG
Former Lagos State Governor, Senator Ahmed Bola Tinubu Thursday cautioned the federal government against any plan to increase Value Added Tax (VAT) in the country, adding that this will create very serious economic difficulties for Nigerians.
Tinubu who spoke during a Colloquium to mark his 67th birthday in Abuja said this will reduce the purchasing power of Nigerians.
He also said such planned increase is coming at a wrong time, urging the federal government to consider broadening the scope of tax collection in which more people will have to pay tax instead.
According to him “Consumer spending is slipping and this is where I will stop and appeal to Professor Yemi Osinbajo and his team to put a huge question mark on any increase of VAT please. If we reduce the purchasing power of the people, we can further slow down the economy. Let’s widen the tax net.
“Those who are not paying now, even if it is inclusive of Bola Tinubu, let the net get bigger and take more taxes and that is what we must do in the country instead of additional layer in taxes.”
He also advised that the global warning on impending economic crisis should be taken serious with necessary measures taken to check such economic trend.
He said, “Even without Brexit, the EU itself has entered a rough patch. The Euro zone may already be in recession. Stock markets experience wild swings that speak to an underlying weakness and pessimism about the immediate future.
“Forecasters are predicting a global recession within the next 12-18 months. I render these observations not to frighten anyone but because they ring true. Wisdom requires that we accept reality instead of obscuring it under the cloak of wishful thinking.
“We must build policies that interact with the world as it is and not with the world as it should be. We must recognize these harsh economic tidings as advance warnings to the wise. Hence we must think deeper and work harder for our people in Nigeria.
“I would be a most wicked friend if I knew a storm was approaching yet convinced you to ready your family for an outdoor picnic under the tallest tree. The truth is always a more valuable guardian than fantasy.
“Our economy must be redefined to be an efficient yet moral social construct with the primary goal of optimizing the long-term welfare of the people through the sustained, productive and full employment of labour, land, capital and natural resources…
“To pull the nation from poverty, government must play a decisive role. It must at times direct and even develop markets and opportunities. This is nothing novel. I am only restating what the established economies did when they were young and assumed their trajectories toward growth.”
Tinubu also expressed hope that the second Buhari administration will work to increase electricity generation, transmission and distribution by more than 50 percent within the next four years.”
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