 You're welcome back. It's still the breakfast on plus TV Africa. And remember that when the president administration came on on the 29th of May, the promise was that the economy was going to grow, maybe like to 6 percent or so. And Nigerians are going to breathe a sigh of relief because we're going to have so much money, we're going to have our lives improved and a lot of things were promised us. And one of the things that the government is trying to do is to look into tax and taxation. So on the program this morning, we'll be dealing with improving tax reforms for economic growth in Nigeria. And to do justice to that, we have Mr. Gabriel Folusio Fasciotto, the managing director, managing partner Gabe Fasciotto and co-chatted accountants and tax practitioners. Good morning and welcome to the program Mr. Fasciotto. Good morning viewers. Good morning. Okay, this question never gets old. What really qualifies as tax? Simple as it sounds, but a lot of us are confused what really is tax. What we are paying in the motor parks is that tax. What we are paying when we are selling our crayfish is that tax. What is really tax? Before we go into trying to improve what this tax is. Well, tax simple goods is a levy of citizens by the government. And that particular levy is not specifically allocated to the payer's direct benefit. That is, I may pay tax in legal state and it may be used for the infrastructure development in Borno State. I shouldn't say because I pay my tax in legal, it should be used to develop the infrastructure in legal. That distinguishes tax from levy. If there is a particular levy, it means that there must be direct benefit to the payer. Then we also have penalty, which is the direct result of a particular offense. So those are the mutual experiences. We are having mutual tax, levy's penalties. Because when people think about tax, every money they pay, we just call it tax. Like I mentioned, you're paying at the motor park, you're paying levy's or maybe tax, we don't know what it is. You're paying monies when you're sitting at the roadside and selling. The federal government will come, the state government will come, the local government will come, and so many people will come. People who do not even have identity also will come. And then we do not know what is tax and what is levy anymore. How is tax collected? How is it collected that it can be known to be tax and not levy? Is it just what you collect from the salaries? Is it just what corporate organizations pay? How is it collected right now in Nigeria? The network was not stable, but if I could hear you very well, you sort of mentioned multiplicity of taxes as well as the usage, utility of such taxes collected. Maybe I must talk about multiplicity of taxes. I'm saying multiplicity of collections in Nigeria. I was saying multiplicity in money's paid, because right now I don't want to use whether tax or levy's, but multiplicity in money's paid. Which of these monies are tax and which of them are not tax? As I've just explained, the majority of the levy's being collected may not be categorized as tax, but in Nigeria, you know, if a local government should come to my house and collect tenement rates, and should collect a penalty for traffic offense, and so everything is categorized as tax. But in the technical sense of it, they are not taxes. But the question is this. How do we even utilize the taxes, the levy's, the penalties we collect from the citizens? I think if you're able to resolve that particular question, then it will assist the citizens to even understand the difference between the tax levy's and their penalties. But, you know, in the real sense of it, Nigeria is bedeviled with multiplicity of taxes, because I can even say that the three tiers of government, they appear not to be happy matters. Apart from the federal government level, which is carrying out the assessment and collection of tax, while still the local government appear not to be happy matters. There are certain preconditions for charging taxes. Even if you are going to levy penalties, if you are going to charge citizens levy's, there are certain preconditions. What we are not following is such. Let me come back to the issue of Finance Act 2023. I want to thank the president and commander-in-chief of the Federal Republic of Nigeria, who saw a flaw in the enactment of that Finance Act 2023. That Act was signed into law on the 28th of May with retractive commencement dates of 1st of May. But with the variation executive order, the commencement date was pushed to 1st of September this year. That is very commendable because the precondition for a tax to be fair should be that it should not be recruting. People should know what type of tax they are to pay, the quantum, and how they are going to pay it. But if you are just leving a tax on a particular day and then you are backdating the commencement date, it creates problems for the tax payers. Know fully where that tax is. We have lost the audio of Fashotu and we are hoping that we can get him back to even talk about the meat of the matter, which is improving reforms of the tax. Okay. Yeah, we lost your audio for a while there, Mr. Fashotu. Sorry for that. Go right ahead. Okay. Okay. So, tax should not be recruting. The major problem we are facing with tax in this country are possibly this utilization of taxes. And we have to give the federal government food use for setting up this fiscal policy and tax reform committee. I am happy that the state government as well as the local government here have representation in that particular committee. You know, unlike in other climes, we look at tax from the perspective of the federal government alone. We even look at the budgetary provision from the perspective of federal government alone, whereas it's supposed to be the budget of the federal state and local governments together combined. That's what we're supposed to be considering. And when you are talking about the tax, how tax is going to fund the expenditure of these serious tiers of government. Currently, for this year, Nigeria budgeted 10. something trillion. And expect it. Okay. The audio of Mr. Fashotu again has gone. We do hope that he rejoins us soon. The network seems not to be very friendly this morning, but we're talking about improving tax reforms for economic growth in Nigeria. We're trying to establish what really is tax, what constitutes what we call tax, and the difference between the real tax and just ordinary levy and penalties as he put it. And then he was talking also about how these taxes are used, the utilization of these taxes for the benefit of the nation. Mr. Fashotu, sorry again, we lost your audio, but let's just go into, you have just said that the committee has been set to look into improving tax. Now, what would be your recommendations for this committee if you were to give these recommendations? How can we improve our tax or how can we reform our tax system in Nigeria? My recommendation will be as follows. I'm happy that the committee, the people, the people that are members of that particular committee, they are well-respected people and they can deliver for good tax refunds for this country. I've gone through a term of reference of that committee. They are having 30-day delivery, deliverables, six months deliverable, and possibly three years deliverable over a year, a year after. Now, the starting point I would have loved that particular committee to take up would be the harmonization of the identification of the taxpayers in the country, because that is still a major problem. If you are not able to identify your taxpayers, it may be a problem. At state level, we are having different taxpayers' identification, that is, in taxpayers' identification. At local government level, I doubt even if we have that particular identification number. At federal government level, we are having different taxpayer identification units. There was an attempt at the joint tax board at a particular time to harmonize this, but it was told. Possibly because of funding. So if this committee is able to harmonize that as quickly as possible, that will be the starting point. With that taxpayer identification, I believe that we'll be able to know those people who are up-to-date in their tax payments, those who are not up-to-date, and those people who are even outside the tax net. I'm happy that the committee has decided that they will not recommend any increasing rate or a recommending additional tax, except where it is necessary. We see having lots of people outside the tax net, and for some majority that are inside the tax net, they are still not paying the right tax under the right time. I believe that if Nigeria is able to harness its tax resources adequately, we will be able to generate times three of our two-to-eight expenditure yearly, as it is right now. If you are budgeting 10.7 trillion, that means that we are capable of generating more than 30 trillion every year. Nigeria is capable of doing that. The only thing is that we need to put the right back in the right form. When we get to that point where more people outside the tax net can be brought into the tax net, is there a possibility that these rates could reduce, rather than just remain there or move up? Yes. Surely in bringing more people into the tax net, there are certain things that have to be done. We need to have tax amnesty. For those people who have not been paying their taxes regularly before, and they have courage to come into the tax net, they either tax amnesty. They will be forgiven those taxes they did with the regulations. Then as we get the rate, that is how much incentive for those people who have been paying their taxes regularly. We should be able to identify those people and then reduce the rate for some as incentive for them. Now, talking about tax incentive, I realize that it's part of the new committee set up by Bureau government to look into the tax incentive. There's nothing bad with tax incentive, but what we have refused to do in this country is to actually control the utilization of the tax incentive. You have given wayward to companies bringing up a new sector of their economy. But after the great period you have given to them for not paying tax, nobody has gone back to know whether they have utilized the tax given to them, a tax discount given to them, the utilization of it for their production, for the economic benefit of Nigeria. This is the end of our problem. We need to assess the benefits of the tax incentives given so that we know whether those who are giving incentive, they are willing to be allowed to enjoy that tax incentive or they need to be penalized for not utilizing the incentive that they have been given. Now, in moving the tax reform forward, we need to conscientize Nigerians about payment of the taxes. Payment of tax is not a bad idea, but rather it is how you are utilizing that tax and the administration of such taxes. In Nigeria, a lot of people see you going to the tax office declaring your income as a body, because it is at that time that the tax office will start running after you to even demand for more income than you are earning and for the purpose of taxing you. I think that is very punitive. They should see people coming up voluntarily to pay their taxes as people who are good citizens and they should encourage them to discharge their obligations. I believe that the current government, they are tilting towards that positive approach concerning taxes. But I will also add that there are so many states in Nigeria that are still not encouraging the conducive atmosphere for taxation in the country. Okay, just a final one here. I'm just asking you on a personal note, how much confidence do you have that all these reforms that will be spoken about by the community will be successful, especially knowing the kind of challenges we have regarding data. Data in Nigeria is a problem. The population census has their own data, INEC has their own data, the banks have their own data, everybody just has their own data. We don't even know the actual population of Nigeria right now. How much of success do you think can be recorded with the kind of challenges we have in data gathering and analysis and storage? Well, provided the current president of the Federal Republic of Nigeria, Ashua Jubola, is still not the same person he was when he was the governor of Lagos State. I have very great confidence in the workability of the tax reform he had just introduced. You know one thing in taxation, you need the confidence, the back in the support, the political will of the CEO to be able to succeed in your tax reform approach. It was when he was the governor of Lagos State that he backed off the Lagos State internal revenue service to reform the taxation in Lagos State and it worked out. And thereafter every governor in Lagos State, they have been given support, they have been given political will. So at federal level, he is able to give the same support to taxation. I believe that we should be able to overcome the issue of data collection challenge in the country. As the president, as the chairman of that committee has stated, we don't need so many fragmented identification numbers like BBL, like NIN, like you know, different identification numbers, we don't need that. Let's pick one like NIN for individuals as well as incorporation numbers for companies. Okay. Then we are able to support. Once we are able to do that, we should be able to reform the data collection challenges in the country. Okay. I wish we had more time. I would have picked your brain on some other things, but this is how far we can go on the program today with this topic. Thank you so much, Mr. Fasioto, for coming on the program. It's my pleasure. Thank you. Okay. That was Mr. Gabriel Follusio Fasioto, the managing director of, in short, the managing partner gave Fasioto and company chartered accountants and tax practitioners. He was talking to us about reforms in the tax, in taxation and everything that has to do with tax. We are going to take very, very short break now. And when we return, we'll be talking about cervical cancer and what is in the offering for women. Stay with us.