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Adoption of progressive tax regime will tackle inequality, poverty-CSOs

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Adoption of progressive tax regime will tackle inequality, poverty-CSOs

By Angela Atabo

A coalition of more than 17 civil society organizations (CSOs) called for the adoption of a progressive tax regime to reduce inequality, poverty and food insecurity in the country.

CSOs, at a two-day national tax summit hosted by the Tax Justice and Governance Platform (TJGP) on Thursday in Abuja, said the call had become imperative as the regressive tax system created poverty and wealth inequalities.

The Nigeria News Agency reports that progressive taxation means higher tax rates for those with higher incomes or more wealth, so those who earn or have more are taxed at a higher rate. higher.

Dr Otive Igbuzor, founding director of the African Center for Strategy and Leadership Development (LSD Center), in his address on the inequality crisis in West Africa, said that inequality was one of the biggest challenges facing humanity.

According to the report by Otive, Oxfam and Development Fice International (DFI) “The crisis of inequalities in West Africa: combating austerity and the pandemic” revealed that the pandemic and poor policy responses have exacerbated inequalities and the poverty crisis in West Africa.

He said Oxfam’s report on inequality in Nigeria documented that the main drivers of inequality were regressive taxation; poor budgeting and allocation system among others.

“The report also prescribed policy solutions that included pro-poor laws and policies; progressive taxation; fight against corruption; fight against the capture of political elites; support small farmers and promote and encourage active citizenship.

“These diagnoses and political prescriptions are still valid.

“Oxfam studies have shown that there are three areas proven to reduce inequalities significantly: one, public services, looking at education, health and social protection.

“Second, taxation, looking at how progressive structures are on paper and in practice, and third, workers’ rights with a particular focus on women’s rights,” he said.

Otive said similarly, development theorists and practitioners have agreed that improving the quality of life for citizens requires focusing on four areas: infrastructure, agriculture, education and health. .

He said the report also prescribed policy solutions that included pro-poor laws and policies; progressive taxation; fight against corruption; fight against the capture of political elites; support small farmers and promote and encourage active citizenship.

“These diagnoses and political prescriptions are still valid,” he said.

Mr. Victor Arokoyo, Senior Program Coordinator, Christian Aid, said the summit was organized because CSOs were concerned about government fiscal responsibility and how to generate more revenue for sustainable development.

Arokoyo said there is a need to have a fair and just tax system so that CSOs are interested in how the government uses the resources they get from tax and make sure it should there is a responsibility in the way they collect taxes.

He said CSOs were also interested in pushing the campaign beyond just encouraging people to pay taxes to insisting on a fair and equitable tax system.

“Today we are looking at the report on Wealth Inequalities in West Africa, what are the factors that push people into poverty? Again, taxation is one of them.

“If we continue to use regressive taxation, you are probably going to push more people into poverty, so we are for progressive taxation, we want people to be taxed according to their wealth.

“We want the rich to pay more and the poor to pay more than the rich,” he said.

Okoineme therefore said the summit aimed to examine alternative avenues the government could take to ensure sustainable financing for development.

According to him, CSOs believe that these avenues exist and can be achieved above all through fair and progressive taxation.

“So the government must take action against the unjustified granting of tax incentives, we are all witnessing the Pandora documents, which indicates that tax avoidance and tax evasion are still happening.

“Therefore, we hope that the government can start to examine these issues critically and see how it can strengthen the tax architecture to mobilize the necessary resources,” he said.

Okoineme said the government, in its 2022 budget projection, talks about improving the government’s revenues relative to GDP, from 8% currently to around 15% by 2025.

He said if this was the government’s aspiration, then it should take the necessary steps to achieve it and not just pretend.

Mr Henry Ushie, head of Oxfam International Nigeria’s Inequality Campaign, said the organization believes the problem of poverty is rooted in inequality, so that if Nigeria is able to end all problems of inequality and all its drivers, poverty would be reduced.

“So we are focusing on investing in key sectors that would help reduce poverty in all its dimensions. According to Ushie, when the government makes commitments to these different sectors, it actually shows that they are determined to reduce poverty in all its dimensions, especially on food security.

Source: NAN

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