Anti-Tax Protest, February 2020; Anti-Tax Protest, Onitsha, 9/12/22
In
the last one year, I have made three major
interventions on Anambra matters. The first was the ‘Letter to Professor
Soludo’(December, 2021) in which I
congratulated the Governor on his
deserved electoral victory and as
in the character of many columnists,
offered some unsolicited advice. The second one was ‘Soludo on the
Driver’s Seat: A Third Order change, A Big-Bang, Cometh!(
March, 2022); in which I previewed
Soludo’s tenure and prophesied
that Anambra would witness a
multidimensional ‘big bang’ . The
third was Ghost-Town Strategy, UGM and Reign
of Terror: By whom and for what? (April 2022), in which I
x-rayed the UGM phenomenon, the ruthlessly enforced Monday SAT( sit-at-home), the
consequential bloodletting and mindless destruction in ana-Igbo
. I made all these interventions as a Soludoist, onye-Anambra in the local diaspora and as a
‘stake-holder’( a term that has been of late misinterpreted, abused and
misused) in the Anambra Project, even though I do not know how much stake
I held or hold. Today, I
am not writing as Soludoist; I am
writing as an ‘ancient economist’
who studied economics in the good old days( 1977-1980) in one of the best Departments
of Economics in the world then( University of Ibadan) peopled by top-notch
academics from all over Nigeria and all over the world. By then, there were
neither android phones to calculate IRR
and NPV nor laptops to design models
within minutes. I am also writing as one who is away from home but is regularly
at home, and who wishes that Anambra should be an ‘A-State’.
Anybody who
occupies a public office, especially as a governor or president in Nigeria,
must surely receive doses of darts from critics; some informed, some
misinformed, some in good faith, some hatchet-jobbers and attention-seekers,
some who felt they should
have been invited to the table,
or that they are poorly appreciated, some political opponents, and those watering the ground for the next
elections. Some are also due to some
avoidable gaffes and slips of tongue by
the dramatis personae. At times, these
darts are a mixture of misinformation, disinformation and malicious
concoctions. Of course, critics are a normal part of democracy. The person in
charge appreciates public opinion and is
kept on his toes. However, this is of limited application in Nigeria where our
‘dealers’ behave ‘Napoleonistcally’, treat the public
with disdain and hope to retain power
by undermining the easily manipulable electoral system. Of course, there is a wide gulf of
difference between criticising and critiquing. Professor Soludo has
received all these types of darts over diverse issues and from diverse publics, within and without
Anambra State. However, my interest today is on the strident public outcry
about Soludo’s tax regime.
Sometimes ago, there was a joke making the
rounds in the ubiquitous social media advising ALL bachelors in Anambra State to quickly get married before
Soludo introduced a wedding tax! Before
then, the trending news was that Soludo
had imposed a funeral tax of N100,000 in Anambra State( which was not true). Three
weeks ago, a group of drivers protested the ruinous taxes imposed on them by
the Soludo who is now seen as a tax-master, not a task-master.
Keke drivers, petty traders, foodstuff dealers, shuttle and bus drivers, have
all protested over the same matter,
making Anambra, the HQ of protests in the last few months. In preparation for
this intervention, I tried to get full details of what transpired in the drivers’ protest and incidentally,
stumbled on two related headlines. The
first, ‘Truck drivers block highway to protest over-taxation in Anambra’ was in February, 2020. Obiano was in CHARGE
then. The second; Soludo’s tax regime: Travellers stranded as
transporters protest in Anambra was in September, 2022( Soludo had taken over by
then). The protest against over-taxation in Anambra State did not
start today; it is probably one of the things handed over
by the Obiano Government. Even across the globe, it is a very old
phenomenon as the star war cry of the American Revolution was
no taxation without representation.
On Friday, 9/10/22 however,
Anambra State experienced the father and mother, uncle and aunt of all anti-tax
protests, the one that drew the attention of the whole world to the tax-crises in Anambra State. Trailers
trucks and tankers coming into Anambra
blocked the Niger-bridge and eventually all the major entrances into
Anambra State( Asaba-Onitsha Enugu-Onitsha, Owerri-Onitsha) in protest over the
contentious N30,000 levy imposed by ANSG.
Probably, they learnt from Canadian anti-vaccine truckers! Beyond the size of the levy, the drivers were
complaining tax multiplicity,
uncertainty and as one of them stated, violence in everything about
collection of money is being witnessed daily in Anambra State, particularly in
Onitsha’ The bridge head has always been the epicentre of traffic madness in the East and we should thus imagine what it looked like when it was deliberately blocked.
An unknown complainant was there for 5 hours( 5-10 am) and had not moved an
inch. You can imagine what this caused Nigerians, Nigeria and Anambra State.
Before all this, I had spoken to some people in the market square and
extracted the following: That in an
effort to expand the tax-net, there was a sudden hike in the existing taxes
payable by various individuals and businesses, and introduction of new taxes
which involved those who were not paying taxes before. That the government
outsourced the tax collection to some firms, who then deployed touts (which the
government had promised to eliminate), who are more vicious than the previous
touts, on the helpless and hapless citizens and businesses. That containers which were charged
about N5000 apiece now pay N30,000 plus other incidentals as a result of which
most of them adopted the Cotonou model (discharging at Asaba and
gradually taking the goods to Anambra or even forcing the customers to come and buy
from Asaba). Okada, keke, taxi, shuttle and township busses are now charged N300. N600,
N700, N1200 daily for 25 days. Datsun,
and 6 tyre trucks are charged N6000 and N20000 to offload and they are also
charged for loading. A motorist complained how ANSG real or fake functionaries
imposed a fine of N50000 on him on the
Niger Bridge, dragged his key with him and he decided to physically withstand
them.
And then, about 1 month, my younger sister
went to make some purchases at Onitsha. After settling the haulage charges with the shuttle
and truck drivers, she was then ‘ordered’ to pay N3000 and N8000 respectively before the vehicles could leave
the park. I don’t think that this had any relationship with the destination. So, in addition to paying the two drivers, she
paid an extra N11000 and this is just from one individual and in one
transaction! I don’t know if this extra payment was part of the taxes on the
drivers and if it was paid directly to the state-government as we were assured earlier. What is obvious is that the
drivers have directly ‘outsourced’ some
of the levies to the customers, rather than paying from their own resources.
So, the tax- protests have been caused by
hike in taxes, in a dwindling economy, highhandedness of the tax
collectors( a return of crude and crooked tax-raiders of yore, a regular
feature of Upper-Iweka) and the reintroduction of touting, which the government
had promised to eliminate, into the process.
Some of these concerns are genuine
and require urgent and coordinated government attention. However, my contention
on the one hand is that we MUST be ready
to pay our taxes; we MUST accept taxation as a normal part of the economic
system, and that all economic players
should pay taxes to sustain the government. On the other hand, taxates should be decently collected and should not
harm the businesses or the state.
Nigerians suffer from acute tax-phobia; they are experts in tax evasion(
as against tax avoidance). Only civil servants pay the taxes because it is
deducted at source. Very few businessmen (including those who can buy my entire
household) have paid the kind of tax, which the son of man has paid this year.
Taxation is not new; the stockpile of grains, which Joseph managed in
Egypt was the outcome of produce-taxation( the equivalent of our own excess
crude account, which Governor Amechi et al
rejected?) imposed by Pharoah. And in this case, the people directly
benefitted from the tax, as the grain-reserve was used to sustain them in hard
times. In Igbo-Ukwu, Chief Umeanadu, our last warrant chief, also imposed all
sorts of levies and taxes on the people, including the labour with which his
palace was built. Beyond the formal
taxes, which he collected for the ubiquitous white man, he could seize anything
he liked from the citizens: palmwine, farm produce and even daughters. Of course our people rebelled and
that was the end of the warrant chief institution in Igbo-Ukwu
However, taxation creates a fundamental dilemma and contains an inbuilt and permanent source of conflict
between the taxer and the taxed. While
tax provides a fundamental source of funding for the government , it reduces the
disposable income of individuals and profits of businesses. Thus, while the government wants to tax as
much as possible, the citizens want to pay as little as possible, especially in
this clime where you need a high-calibre microscope to see what has been done
with the money. It is thus imperative to
create a delicate, optimal balance, between these two conflicting interests because
the extreme in either direction( taxing
too much or not taxing at all) will not
help anybody. This is the reason why economists, right from the days of
good-old Adam Smith, have harped on the principles of a good taxation policy and process. In his Wealth
of Nations (1776) Adam Smith identified the four principles of taxation as fairness(
compatibility with tax-payers circumstances, including the ability to
pay), certainty ( known information about the why when and how
of taxes)convenience( simplicity and ease of compliance) and efficiency(
positive impact on the payers and the economy
and cost-benefit analysis). Other
principles include empathy, enforceability. proportionality and neutrality.
I am now, by the powers conferred on me by Professors Edozien, Mbanefo and Iwayemi, adding
civility and clarity!
It appears that most of these ATPs
(Anambra-Tax-Protests) revolve around
the issues of fairness/ability to pay,
certainty/clarity, empathy and civility. Some people are also not happy that despite the governments promises, touting
and indiscriminate revenue collection are back in FULL force. In an era in which the
NNPC remittance had shrunk from $3bn monthly in 2015 to zero, when FAAC allocations have nose-dived abysmally, and when there is a new
governor in town who wants to make a serious dent on our infrastructure deficit, we should
be willing to pay our taxes. Furthermore, criticisms of the tax regime
should also be a little bit scientific. We
should consider the current tax
regime with the previous one, and with tax-regimes
in other states in same socio-economic status . Again, people are taxed based on their incomes or usage
of public facilities . Most of the
protestants have been arguing that the taxes are too much and the question is ‘too much relative
to what’? To what they want to pay or to what they ought to pay ? It is
obvious that if the government taxes businesses out of existence, it will have
no more businesses to tax. The process
of tax collection should also be civil and decent. And the people should eye-mark
what the government does with the taxes. I doubt if anybody from Ikenga, where
the first tarred road since history, is being constructed, would ask what the
government does with its taxes!
On the other hand, the government must continuously engage the various tax payers, listen to their complaints, and act with compassion when and where necessary. The intervention of the State Government following the recent face-off at Onitsha and the 4-point agenda( dealing with rogue tax collectors, inclusive efforts to sanitise taxation process, reliance on only government appointed agents and appealing for public support and release of help-lines) highlighted by the government is welcome. It also shows that the government understood or appreciate the concerns of the tax-payers. I hope that this douses the tension sustainably. And just the other day, the Operation Clean and Healthy Anambra, (OCHA) Brigade, in conjunction with other security forces arrested 7 illegal revenue collectors, operating within and around Awka. This is a sign that the government is walking the talk and this will help in confidence building.
Part of the recurrent issues
with change and change management is resistance. These ATPs are part of change
resistance and the government should deploy the
strategic change resistance
management model in addressing this
tax-is-too-much matter. There should also be an effective strategic change management communication. This ‘governor is always right’; or
‘ all correct sir’ model will
NOT do!
The taxed should also
optimise the key advantages of being a tax-payers. On
22/5/18, Professor ROC Somoye (presently the Deam of Faculty Administration and Management Sciences)
delivered the 82nd Inaugural Lecture
at Olabisi Onabanjo University, titled Multicratic
finance, fiscal governance and sustainable development: Where does the money
go? What concerns me is not the
big grammar, especially ‘multicratic’ in the first part of the topic; my concern is on the question where does
the money go?. When we pay our taxes to the government, we should be in a
position to boldly demand accountability
by asking: where has the money gone? We should also ask whether
it went where it should go (our priorities) and whether a road that costs N20m per KM in Imo state is
priced at N75m per km in Anambra State. That is the most important outcome of
these tax protests and awareness.
As for
the government, I want to give an unsolicited consultancy. Most of our people
are living in the local and global diaspora. We can persuade our people outside
Anambra to voluntarily key into
Anambra Diaspora Support Fund of, for instance, N5000 monthly. If 2.5m ndi-Anambra
subscribe to this fund, it will gross about N150bn PA, which may be enough to remodel and standardise our secondary schools within a year. Asking for regular small contributions is
better that asking occasionally for fanfare-based big donations,
where bad-debts exceed the good ones!.
Of course, this presupposes that the government has the database, practices
transparent governance, makes genuine
strides that are visible (as against propagandising) and enjoys the goodwill of the people.
To sum, the people MUST agree to pay their taxes; that taxation is inevitable in a modern society. The government on the other hand MUST ensure that the principles of taxation, especially equity, convenience clarity and civility are applied. I have spoken!!!
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