PAYE Tax, Stakeholder Concern and Country Development
Tony Monye
In point of fact, Lagos State is beyond a state. And, that is written without any sense of exaggeration. Lagos is more or less a country. The state can be compared to the other countries in Africa, especially along the continent’s west coast. Take a look at the state’s GDP and compare to Liberia, Sierra Leone and Togo’s figures. The state’s economic indices completely outclass theirs while competing favourably with even Ghana or Cote D’Ivoire’s. Analogously, the Federal Capital Territory – (not yet recognised as a state) – Abuja – perhaps, with no one noticing – is rapidly morphing, racing up the path that shaped the Lagos’ development trajectory. The end outcome is for time to reveal. And, it surely will. Comparatively, the other thirty-five states in the Nigerian federation are less than what one would call a state in terms of revenue generation, infrastructural presence and the other state-determinant economics and features, as they are straddled by very weak eco-financial profiles. In fact, their Treasuries are often said to be in chaos, which I think should be some wake-up call to all their stakeholders. For instance, benchmarking the VAT and IGR (largely driven by consumption and the spate of economic engagements) numbers across the states in Nigeria presents another vivid revelation of immense size. The disparity between Lagos and Abuja’s VAT and IGR figures, on the one hand and the other 35-states’ is frankly too dizzying for comfort and should raise some concern. Some (constitutional – largely fiscal) arrangements must have led to this. Therefore, truly concerned elected political office-holders and economic planners should know it’s time they spoke up. Their continued silence rewards no one, not even the present benefitting states, especially in the long range. The gap also does not speak in favour of country-wide development, especially when it negates the exact arrangements the nation badly and urgently needs. Of many of the factors driving the unwholesome developmental optics, the structure of the country’s tax (particularly the PAYE system – how this is shared) can be considered to be at the heart of this misnomer.
