A policy and legal expert, Clement Nwankwo, has argued that the Nigeria Customs Service (NCS) and other revenue-collecting agencies of government should not be allowed to retain any percentage of the taxes collected on behalf of the government aside from their annual budgetary allocations.
Nwankwo, who is the Executive Director of the Policy and Legal Advocacy Centre, said for taxation to be effective in Nigeria, there has to be accountability on all fronts.
He was a guest on the Friday edition of Inside Sources with Laolu Akande, a socio-political programme aired on Channels Television.
In November 2024, Customs said it collected N5.7trn in annual revenue, with a month left in the fiscal year as of the time of the announcement.
However, Nwankwo said a lot needs to change within the taxation system to increase collectable revenue for governments at all levels.
He said, “Taxation has been handed over to companies and consultants; companies with dubious ownership between themselves and public officials are the ones collecting taxes for the government. So, the way that these companies operate is such that it doesn’t matter to them the fairness of the taxation.
“If you come to Abuja, for instance, you could have a fee slapped on you for something by a consultant and his tax-collecting company who is going to get a cut. So, their measure of success is how much they can extract. So, a lot of times, the level of taxation is exceedingly high. Whatever they collect, they get their shares.
“The same thing for government agencies. I have no understanding why agencies should be allowed to retain a huge percentage of revenue collected. For instance, if you go to Customs, Customs is allowed to retain some percentage. That has to change to see this country move forward.
“What you see this agency do is to collect these taxes. You can imagine collecting taxes running into trillions of Naira and being asked as an agency to retain even 1% of that. There is a lot that needs to change within the taxation system that can help to increase collectable revenue for governments at all levels.”