Abdulfatah Oladeinde
Former governor of Anambra State, Mr. Peter Obi, has warned that more Nigerians would be thrown into poverty next year if the Muhammadu Buhari administration goes ahead to increase taxes, remove petroleum subsidy and hike electricity tariff.
Besides, Obi who was a guest on an Arise TV morning show on Tuesday warned that the nation’s economic group would be forced on the reverse by those government decisions.
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Obi who was the vice-presidential candidate of the People’s Democratic Party in the 2019 election said the development partners’ position is that for a country to have proper economic growth and pull citizens out of poverty, such a country is supposed to have a tax of 15 per cent and above to the GDP. He said that “Nigeria’s tax to GDP is about 5 per cent. That is well below the standard. But there is a reason for that. Nigeria is a country of about 200 million. For a population of 200 million, the standard is that 60 per cent is supposed to be employed. And 60 per cent of 200 million is 120 million.
“This is the figure of those who are supposed to be working and paying tax. “But with unemployment and underemployment combined, only about 40 million Nigerians are working. FIRS said only about 40 million Nigerians are paying taxes. That means that is the only population that is working. Therefore, the country is getting taxes from only a third of the taxable population because of unemployment. So, going to tax these people more, you’ll be creating a crisis.
“You will see business closures; more unemployment; lower disposable income; lower demand of product and services, which will lead to lower growth.
“If you really want more tax, what you need to do is to work assiduously in pulling more people out of poverty. If you pull another 40 million out of poverty, you will double your taxable population. And if you do that, you will have more disposable income in people’s hands; you will generate more taxes; there is going to be more demand for local products and the economy will grow. “The way to achieve this is to genuinely support the engine of growth. That is the micro, small, medium enterprises”.
The former governor faulted the claims by the current administration of giving billions to MSMEs, saying he lives in Onitsha and Nnewi but is yet to see any small business owner who said he applied and got any support from the government.
On subsidy, Obi said the government claimed to spend N1.8 trillion annually to subsidise petrol price. He stressed that the government must investigate the genuineness of the volume of fuel consumed and remove unnecessary costs.
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He wondered how the government decided to remove the N1.8 trillion subsidy only to replace it with a plan to pay N5,000 to 40 million Nigerians which will amount to amount to N2.4 trillion annually.
“Where will you source the money? Where is the data to give this N5,000? Is it a salary? Is it an unemployment benefit? How are you going to identify the people who will get the N5,000? It’s another confusion. That was what they did with the conditional cash transfer. Nobody can explain what happened to that programme today. Let us do things properly”.
Obi further faulted the president’s frequent trips abroad in search of foreign investment. He said if he were Buhari’s adviser, he would tell him that since he has just about one year more left in office, he should tour Nigeria and bring the country together.
The former governor lamented that the country’s cohesion has gone worse under Buhari and the citizens seriously divided. He added that the country is insecure.
Obi asked rhetorically if anyone would go and invest in Afghanistan, wondering which investor would bring his money into Nigeria that is rated as the third most terrorised country in the world.
The former vice-presidential candidate noted that India is investing $7billion in Malaysia, saying he did not hear about the Malaysian president going on any foreign trip to talk about that.
Asked what his aspiration is for 2023, the former governor said his party, the PDP recently changed its management team. He said once the direction the party is headed becomes clear, he would make his decision public.