Heavy Taxation Strangulating Economic Activities, Businesses’

Heavy taxation in Enugu State is currently strangulating economic activities as indigenes and businesses are struggling for survival, a lawyer cum politician, Chijioke Edeoga has said.

To this end, he urged the state governor, Peter Ndubuisi Mbah, to put human face to his tax policies to attract further investment and businesses into the state.

Edeoga, who was the candidate of the Labour Party in the 2023 Governorship elections in the state, appealed to governor Mbah to ‘have mercy on the people of the state’ by reducing the tax burden that allegedly came into operation since the advent of the present administration in the state.

In an open letter to the governor, titled, ‘Heavy and Multiple Taxes: Have Mercy on the People of Enugu State: An Open Letter to the governor of Enugu State, Edeoga,’ highlighted the multiple increases in taxes, arguing that, such excessive tax regime has led to frustration-induced high blood pressure and the flight of businesses away from the state.

According to him, “You have increased tenement tax for bungalows in Enugu metropolis from N30,000 to N150,000 per annum. Tenement tax for high-rise buildings in high-density areas of Enugu metropolis increased from N50,000 to N300,000. Tenement tax for high-rise buildings in low-density areas of Enugu metropolis increased from N80,000 to N400,000. Land instrument/title registration increased from N70,000 to N300,000. Private school tax increased from N30,000 to N200,000 per annum.

RELATED

Savannah Energy Empowers 100 Students

4 hours ago

BIC Reaffirms Commitment To Youth Empowerment Through Creative Initiatives

4 hours ago

“Trading shops of all kinds were forced to pay a new flat rate of N21,000 wherever they are located in the state irrespective of the number of persons occupying them. This excludes charges for refuse disposal and management and other arbitrary charges.

“In timber sheds, Mbah, a single pole attracts a tax of N100. This in addition to the N21,000 the shop owners also pay. Daily taxes for all buses operating in the state increased from N200 to N2,000. Daily taxes for Tricycles/Keke increased from N100 to N450. Daily taxes for barrow pushers increased from N100 to N2,000. Small business premises tax soared to N25,000. Medium business premises tax skyrocketed to N56,000 while malls are made to pay N200,000.”

In Enugu, he added that, “we have a Purchase tax that ranges from N5,000 to N15,000 depending on location. This has been imposed on groceries and all factory products, from which VAT had already been collected, meaning there is double taxation, assuming that all other taxes listed are morally justifiable. We recently got what you called Carbon emission/generator tax for hotels ranging from N88,000 for small hotels to N200,000 for big hotels.”

Making reference to the tax principles laid down by renowned economist Adam Smith, Edeoga contended that good taxation must adhere to the principles of fairness, certainty, convenience, and efficiency.

“Fairness, ” he wrote, means that taxation should be compatible with taxpayers’ conditions, including their ability to pay in line with personal and family needs. Certainty, he further advised, should mean that taxpayers are clearly informed about why and how taxes are levied.

“In terms of convenience, Smith talked about the ease of compliance for the taxpayers, that is how simple the process for collecting or paying taxes should be, while, efficiency, the final leg of the quadruped stated that the administration of tax collection should not negatively affect the allocation and use of resources in the economy,” he stated.

He appealed to governor Mbah to reconsider his approach to taxation by factoring in the economic realities of the people, the ability to pay, and the future economic growth of businesses in the state.