A chartered accountant and tax consultant, Gabriel Akinlolu, speaks on taxation and security challenges, among other issues in the country in this interview with Adekunle Aliyu

Do you think the Nigerian economy is improving, considering the hardship in the land?

The truth is that Nigeria’s economy is not moving forward compared to what we used to have. When you look at the statistical data, the cost of goods, commodities in the market, and services. I do not think Nigeria’s economy is moving forward.

So, what should be done to alleviate the sufferings of Nigerians?
I do not think that those at the helm of affairs are doing enough to alleviate the suffering of Nigerians. Nigerians are suffering and the cost of food in the market is too high.

So, the government needs to wake up to its responsibilities. I don’t want to emphasize whether the government is doing well or not, it is a collective responsibility. But I think government officials have the mandate to represent the interest of Nigerians.

Do you agree that Nigeria is out of recession and how can we come out of it if not?
The National Bureau of Economic Research (NBER) defines a recession as “a significant decline in economic activity spread across the economy, lasting more than a few months, normally visible in the real gross domestic product (GDP), real income, employment, industrial production, and wholesale-retail sales.” The Nigerian Bureau of Statistics (NBS) at a time said that Nigeria is gradually moving out of recession but that is contrary to what is obtainable in the open market.

The cost of goods and commodities in the market are very high I can say that Nigeria is experiencing hyperinflation and we have serious issues at hand concerning the economy. Inflation has a multiplier effect, there are some food items like rice and other basic food being produced in Nigeria today and if you want to compare their cost with what it used to be then you will agree with me that things are not right in this country.

Inflation will surely multiply across sectors because the cost of moving your goods from one point to the other will surely go up, the cost of getting raw material, excessive, and out-of-control general price increases in an economy that is called hyperinflation and every sector of the economy is feeling the heat.

How can we come out of it?
What I feel is that we must be able to identify the problems before we can think of proffering solutions and one of the key issues that I have personally identified is the issue of insecurity in the country. The nature of insecurity is so tense that many farmers cannot go to their farms.

Lots of them have been killed and so many farms have been destroyed. It’s difficult to farm peacefully in this country again, life and properties are no longer safe. So, we need to address the issues of insecurity. The government must be serious in the fight against banditry, Boko Haram, and all forms of insecurity. If we fail to do so then we are not serious about managing this economy.

The other aspect is fiscal policy. The government needs to check the fiscal policies because these are instruments used in monitoring the economic indices so the government needs to readdress or look into this. Lastly, I do not think our government is doing enough to manage our forex and that is also contributing a lot.

The exchange as of today, a dollar to naira is close to N600, which is huge. You can imagine if you are an importer or manufacturer that needs to import raw materials to make your produce or products and when you factor in other costs your product will not be that affordable in the market because the exchange rate has already inflated your cost of production. Although the CBN governor has just taken a bold decision that we have been expecting for a long time by stopping the supply of dollars to Bureau de Change, we hope that this will have a positive impact on the economy.

It is a bold decision because if you know those that have the licenses, then you will understand why I said it is a bold decision. Bureau De Change license is not for small boys, the holders in this country are powerful people and when you look closely into their activities, then you will appreciate the decision of the CBN.

What do you think the Bureau de Change operators are doing behind the scene?
Most of them are into illegal activities like round-tripping, buying, and selling dollars at very high prices. Some of them are selling dollars to bandits and insurgents for the acquisition of ammunition. The government could not keep quiet again, so, they had to stop. My fear is, can the bank make the forex available to those who need it for genuine purposes?

Do you see the banks being effective in this new responsibility?

My bank has sent me messages analysing how they want to achieve this new policy by the CBN and when I read through it sound so good but I have not met anybody that has gone to the bank to buy dollar recently hence I do not know how effective it is currently to buy at the banks but I know that at first, it is going to be difficult and gradually we will get there.

What is your assessment of Nigeria’s tax system?
Nigeria’s tax system is improving. Over the years we have been having problems such as multiple taxations, administration problems, unavailability of the database, minimum tax issues, tax evasion, and avoidance, and the basic rules that are associated with commencement, change of accounting date, and cessation among others but the present administration under the leadership of Mr.Muhammed Mamman Nami and the precedent administration has introduced some measures to improve the tax system and solve some of the identified problems.

Some of those measures include the Finance Act 2019 which has amended some sections under the Company Income Tax Act, Capital Gain Tax Act, Value Added Tax Act, etc. Secondly, the introduction of online platforms like, etcplatform, tpplatform, and TaxPromax. All these measures I believe will solve most of the tax issues we have in this Country.

How effective is the government’s policy on the ease of doing business?
Nigeria is a blessed country with plenty of opportunities and investors are eyeing to come and invest here, however, the question remains, is the country peaceful for these investors to come and invest because for them to come they have to consider their safety first.

The insecurity in Nigeria is affecting a lot of investors but one has to give this government kudos for their effort to restore the confidence of investors to come and invest in Nigeria by way of simplifying the registration process. When you look at the ease of doing business ranking, we have moved up from 169 in 2016 to 131 in 2019. This success is attributable to the progress recorded in registering a company in Nigeria.

There are insinuations in some quarters that famine is looming in the country, do you agree with that line of thinking?
I guess a layman should know that famine is looming in the country because when our farmers cannot go farm to the farm, how are we going to live, how are we going to feed and how are we going to survive? Note that three basic things in life are food, clothing, and shelter of which the most important is food.

If a young guy on the street can’t get food to eat within the next three to four days, he becomes so aggressive and violent. Do you know what that means, he becomes a threat to the community at large so it has to fall back to the issues of insecurity. We have to talk to our government, if the government are so serious to fight any opposition and clamp down on those calling for secession I think they can use that same energy to clampdown on these bandits, they are not faceless human beings, we’ve seen government official going to speak to these bandits.

They are not faceless even if they are faceless you cannot tell me that bandits can be powerful than a Nation. So why I said famine is looming is because of the insecurity, farmers cannot go to farms. We in the south do not farm, you read on the news daily about Benue state which is believed to be the food basket of the nation, farmers are killed daily.

This is where food is coming from. Go to Adamawa, Kebbi is the same killing. The little food that we have in the market is not affordable so if the government fails to correct that now I am telling you Nigeria may not be talking of hyperinflation in the next few years but famine and that is not good for our country. We all are in danger if we do not take the necessary steps.

How can the government make more money?
This government has been saying that they are diversifying the economy and how do you diversify the economy? is by moving the economy away from crude oil.

Thank God that it is very visible to everybody that crude oil has not done Nigeria any good rather it has done us the opposite. The discovery of crude oil has made Nigerians so lazy, we are no longer productive most people want to become oil workers everybody wants to be in the oil industry but thank God this government is now diversifying from the oil sector and I can see from my own personal analysis and indices that there is some kind of improvement in terms of improving on the non-oil sector and one of the non-oil sectors is taxation because it is a compulsory levy for every Nigerian and its one of the fiscal policies instrument for mobilization of revenue to further development, for infrastructural development but I am worried for the fact that the tax policy and legislation are focusing more on common Nigerians as I speak to you today most of the rich don’t pay tax.

The tax is being paid by the common man, the poor on the street. In the vein of increasing revenue, the government has recently introduced some tax policies such as Increase in VAT rate, introduction of new stamp duties, Communication charges etc. we are not saying this is bad but when you look at enforcement and its administration, the poor and common man suffer more of these taxes. Before 2015 I and my former boss discussed that the country needs to introduce what is known as the luxury tax, in fact, there was an article we did then stating that Nigerian needed to introduce Luxury Tax and thank God for the Jonathan’s’ government that introduced the Luxury Tax in 2015 but as I speak to you today up to 2019 the government of Nigeria has not generated any revenue from that particular stream of income because they have refused to enforce it.

Can we then say the government is afraid of the rich? You imagine in a country like Nigeria that people are competing to acquire private jets, the decision to acquire private jets means you must have acquired all the necessities of life then the next thing is luxury.

All acquisitions that are luxury need to be taxed heavily and appropriately because it is believed that if you are living in any community or society and you have benefited in that society to have amassed wealth for yourself there should be a redistribution so that every other person can benefit, the government can easily do that through luxury tax, the law is there but the government is not enforcing it.

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In fact, as a matter of urgency, the government should begin to investigate and measure the income of individuals that are acquiring property of more than N500Million. We should be able to determine how much tax he or she has paid to the government coffer over the past years incommensurate with the wealth he or she is displaying.

These are the areas the government can use to increase revenue, you can imagine that some people can even go as far as acquiring yachts that are worth millions of dollars and the government is not taxing these people appropriately. When you go to Abuja you see so many abandoned properties that can be valued at N500 million and above all abandoned yet some people are somewhere with nowhere to lay their head.

That is why we have said that if the government is serious about increasing revenue, then the opportunity is there for them to enforce this tax.

If you want to live a luxurious life you must be able to pay for it.