The agenda that the government led by President Bola Tinubu plans to adopt in order to improve the difficult economic situation has been revealed by Wale Edun, the Minister of Finance and Coordinating Minister of the Economy.
He made this announcement on Friday in Abuja, during his first press briefing, during which he presented Tinubu’s economic ambitions, agenda, and strategy.
According to Mr. Edun, the administration has identified a number of priority areas, some of which are as follows: food security; economic growth; utilising human resources by focusing on inclusivity, women, and youths; focussing on rule of law and anti-corruption; and so on.
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He stated that there will be periodic performance evaluations for the various Ministers so that the Nigerian people could see the accomplishments of the ministers.
Mr. Edun shared with us the following: “This is to give you components of Tinubu’s vision and his strategy for the economy, his plans to provide Nigerians a better economy and a better living.”
“His objectives for the economy include economic growth, the creation of jobs, and access to finance, notably consumer credit, which will make growth affordable to the average Nigerian. ”
“The priority areas where he is going to lead Nigeria, and his key priorities, are to enhance the lives of Nigerians by providing food security, and by reducing poverty,” he said.
According to the minister, the last time the nation enjoyed significant economic growth, reasonable interest rates, low inflation, and a low exchange rate was ten years ago. The minister also stated that the country’s exchange rate was low.
“We are not where we should be, the economy is growing just over the pace of population increase but it has not always been that,” he remarked. “We all know that we are not where we should be.”
According to Edun, when previous President Goodluck Jonathan was in office, the country had a sufficient amount of foreign exchange to protect the value of the naira and fulfil its financial commitments.
“What this hints at is that we have a situation where if the government doesn’t have the money, it has to facilitate and enable private funding and other sources of funding such as foreign direct investments and domestic investments by Nigerians in all areas,” he added. “What this hints at is that we have a situation where we have a situation where if the government doesn’t have the money, it needs to facilitate and allow private funding.”
Mr. Edun stated that boosting revenues was at the top of Mr. Tinubu’s goal in order to ensure that there is sufficient funding from the government to carry out the government’s expenditures.
“On the one hand, one way to raise more money through taxes is not to raise more money through taxes, but rather to bring about higher efficiency and to maximise the revenue.
“There will be an emphasis placed on efficiency in government expenditures as well as effective debt management in order to ensure that borrowing is related to it, the effective debt management.”
He stated that “also, the president is going to give a better life for everyone by supporting investments that enhance productivity, develop the economy, and therefore generate jobs and reduce poverty.” “Also, the president is going to provide a better life for all by encouraging investments that improve productivity,” he continued.
The Chairman of the Presidential Fiscal Policy and Tax Reforms Committee has hinted at plans to reform the nation’s tax code in order to close the N20 trillion tax gap that the country experiences yearly as a result of tax avoidance, tax evasion, and tax incentives.
He stated that Nigeria loses up to N6 trillion annually due to tax incentives established by previous governments, which did not deliver the expected benefits for the country. He said this was a huge problem for the country.
“When you don’t look at your incentives regime it can get to a point where it becomes a distortion for economic growth, because some individuals benefit or that don’t and the works in the same sector, so they cannot compete. When you don’t look at your incentives regime it can get to a point where it becomes a distortion for economic growth.
“If you look at our tax expenditure reports over the past three or four years, on average, we have given out around N6 trillion every year. That is a substantial amount of money, and what we have not been quantifying enough is the value that we are getting from it.
“When you fail to take a look at your incentives framework. Because some people benefit or that don’t and the operations in the same sector, so they cannot compete, it has the potential to reach a point where it becomes a distortion for economic growth. This can happen when it reaches a certain amount.
“So I can disclose to you that as part of the mandate given to us by the President, one of our responsibilities is to look at the incentives system in Nigeria.
“In order for us to be able to construct what is right for us as a country in terms of what we want to achieve, so those incentives will be targeted,” he added. “So we can base our designs on facts and evidence.”
According to Mr. Oyedele, the current administration is putting a strong emphasis on driving excellent fiscal control, expanding revenue beyond taxes, and maximising non-tax revenues.
He stated that the objective was to attain an 18% tax to GDP ratio over the course of the following three years while simultaneously assuring a reduction in the amount of taxes that Nigerians are required to pay.
“So that seems like a contradiction, how do you remove taxes and collect more, but it’s easy to explain, because we know where the gaps are. The estimated tax gap, which is what you should collect today if people should pay the proper amount of taxes, is somewhere in the region of N20 trillion. “So that looks to be a contradiction, how do you remove taxes and collect more, but it’s easy to explain because we know where the gaps are.
We shall thus rely on automation and the efficiency of collection, particularly the harmonisation of the way in which those taxes are collected, in order to close that gap.
“The second issue is, if you also consider the incentive rationalisation, maybe it’s not N6 trillion that we should be giving away, maybe it’s N2 trillion, and it must be targeted at people that need them the most.
“And the one that is even more intriguing is the plan to increase tax revenue by developing the economy,” Mr. Oyedele said. “So if you allow people to be wealthy and businesses to thrive, then you make money from revenue organically.” “And the one that is even more interesting is the plan to increase tax revenue by growing the economy.”
He stated that continued efforts were being made to enable economic growth and inclusive development by eliminating noteworthy obstacles to conducting business in Nigeria. This was stated in the previous sentence.
