The President Buhari administration has constituted a Presidential Task Force to urgently consider measures that would ensure a steady flow of produce to the market and reverse recent price increases.
Giving the directive today at the Federal Executive Council meeting, Acting President Yemi Osinbajo, SAN, expressed concern at some of the inflationary rates of food prices, noting that the Task Force will explore options to promote availability and affordability of food items to Nigerians.
According to him, the Task Force, which has seven days from today to report back to the Council will consider how to remove some of the cost-raising factors that come into play between the farms and the markets and therefore “bring relief to our people.”
While there have been reports of bumper harvests in parts of the country, the prices of food stuff still end up rather high, while some of the produce even end up wasted due to a number of reasons preventing effective transportation delivery to the markets.
One of the focus areas of the Task Force, the Ag. President noted, would be to review the transportation and preservation processes, and see how government can intervene in those aspects to bring down food prices.
The Task Force, which would be meeting with the Ag. President in the discharge of its urgent assignment, will therefore draw out a practical plan and present same to the Council next week.
Members of the Task Force include the following:
Minister of Agriculture & Rural Development, Chief Audu Ogbeh
Minister of Finance, Mrs Kemi Adeosun
Minister of Industry, Trade & Development, Dr. Okey Enelamah
Minister of Transportation, Honourable Rotimi Amaechi
Minister for Water Resources, Engr. Suleiman Adamu
Minister of Labour & Employment, Dr. Chris Ngige
The Offices of the Chief of Staff to the President and the Senior Special Assistant to the President on Sustainable Development Goals, SDGs, would also be on the Task Force
Meanwhile, the Federal Executive Council on Wednesday approved the revised National Tax Policy.
The policy will see the Value Added Tax on luxury items, like champagne, increasing from the current five per cent, among other changes.
The Minister of Finance, Mrs. Kemi Adeosun, disclosed this to State House correspondents at the end of a meeting of the council presided over by Acting President Yemi Osinbajo.
She was joined at the press conference by the Minister of Information and Culture, Alhaji Lai Mohammed; and the Minister of State, Aviation, Hadi Sirika.
The government identified some items that were to be taxed as luxury goods to include champagne, alcoholic beverages, private jets, luxury cars based on engine capacity, and yachts.
Adeosun said while the implementation of the revised policy would take immediate effect, some aspects that required changes in law would be referred to the National Assembly for action.
She said Nigeria was one of the countries with the lowest Gross Domestic Product tax ratio in the world, adding that non-payment of tax was one of the biggest factors that contributed to the nation’s current economic situation, hence the need for the revised policy.
In implementing the new policy, the minister said the government would attempt to reduce the number of taxes with emphasis on indirect taxes, as well as centralising tax administration where possible.
Adeosun said, “What the committee has shown is that we should look at actually increasing VAT on some luxury items. With VAT of five per cent, we have the lowest VAT. While we don’t think VAT should be increased on basic items, if you are going to drink champagne in the United Kingdom, the VAT is 20 per cent; so, why should it be five per cent in Nigeria?
“So, they have made recommendations that we should pull out some luxury items and increase VAT on those items immediately. And I think that is a very valid and sensible suggestion, which we are going to talk to the National Assembly about to see how we can implement it.
“But as far as basic goods are concerned, no. I believe it is only fair that when you consume luxury goods, you should pay a little bit more. The National Assembly will decide the percentage.”
The minister said the objectives of the revised policy included to guide the operation and review of the tax system; provide the basis for future tax legislation and administration; provide clarity on the roles and responsibilities of stakeholders; and standard benchmark on which they would be held accountable.
In implementing the policy, Adeosun stated that an office of tax simplification would be established; a tax policy implementation committee would be set up; only one revenue agency per level of government would be allowed; the Independent National Electoral Commission to mandate political parties to articulate their tax agenda during election campaigns; and the establishment of administrative framework for amnesty and whistle-blowing, among others.
Others are to develop Key Performance Indicators for Nigeria to attain a top 50 on ease of paying taxes by 2020; creation of a dedicated tax policy website; setting aside a uniform day in the year as a National Tax Day; as well as the promulgation of an Act to establish the Joint Tax Board’s mandate beyond its current advisory role.
Why is this government perpetually in a reactive mode to the economy? The government should rather focus on providing critical infrastructure like power and navigable roads, remove obstacles and barriers and enable access to affordable capital for businesses.
Once these are in place entrepreneurs will fill in the gap to produce goods and services, increase employment and the economy will thrive. The government seems to be wringing its hands and putting out fires all the time.