Nigeria tax system is build on taxing prosperity not poverty, according to Dr. Zacch Adedeji, executive chairman, Nigeria Revenue Service (NRS).
Adedeji, also dismissed the insinuation that the government’s tax reform is aimed at extracting money from Nigerians .
He said the essence of reform is creating an economic environment where individuals and businesses can prosper.
Dr. Adedeji made the clarifications on Sunday night while appearing on Channels Television’s Politics Today, where he defended the administration’s tax reforms and addressed concerns over rising government revenue amid the economic hardship facing Nigerians.
According to him, the government’s objective is to tax the fruits of investment rather than the investment itself.
“For us at Nigeria Tax, we are not there to extract. Our focus is not revenue. I don’t want to tax poverty. I’m to tax the fruit, not the seed, and I’m to tax the return, not investment.”
Adedeji explained that the government would generate more revenue as businesses became more profitable, without necessarily increasing the tax burden on individuals and companies.
He said a company that made N100 in profit could generate N30 in tax revenue for the government, but if its profit increased to N200 or N300, government revenue would rise accordingly.
“So, if I want to make more, I must work for you to make more. And that is why it is in the best interest of us in Nigeria Revenue Service that businesses are doing well, individuals are doing well,” he said.
He said the approach was consistent with President Bola Tinubu’s economic agenda, which seeks to remove barriers to investment and create a more conducive environment for businesses to operate and expand.
Adedeji cited reforms in the electricity sector as part of the government’s efforts to stimulate economic activity.
He noted that the Electricity Act had devolved powers to state governments to generate, transmit and distribute electricity, arguing that improved power supply would boost production and productivity across the economy.
