Rivers Assembly Moves to Boost IGR

18 Nov 2012

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Rotimi Amaechi        

Reacting to cries of people and businesses in Rivers State over multiple taxes and harassment by the Board of Internal Revenue, the state House of Assembly has commenced moves to restructure the board and boost the revenue of the state without scaring investors, writes Ernest Chinwo  from Port Harcourt…

The Rivers State House of Assembly has started moves to change the laws establishing the state Board of Internal Revenue to make it autonomous and boost internally-generated revenue. The assembly last Wednesday held a public hearing on an executive bill aimed at restructuring the board. The House had earlier requested for memoranda from stakeholders on how to make the law richer in content and achieve the desired goals. Those present at the public hearing included the government ministries, departments and agencies, the organised labour, banks, professional bodies, civil society organisations, corporate bodies and other interest groups.

Public Hearing
Declaring open the public hearing on the draft Rivers State Revenue Administration Bill, Chairman of the Finance Committee of the state House of Assembly, Mr. Josiah Olu, said Governor Chibuike Amaechi introduced the executive bill to increase the internally-generated revenue, harmonise the tax system in the state and to ensure that the tax system meets internationally acceptable standard. He noted that revenue from the federated account was dwindling and that there was need for the state to look inwards to strengthen its revenue generation machinery to sustain development.

“So we need to look inwards to ensure that we collect our taxes to shore up government revenue, not necessarily by introducing new taxes but more by ensuring effective and efficient collection of existing ones,” he said.

In his message, Speaker of the State House of Assembly, Hon Otelemaba Dan-Amaechree, who was represented by the Deputy Speaker, Hon. Leyii Kwanee, said the law governing revenue in the state was already moribund, adding that the state was capable of generating enough revenue for the administration of the state.

The state Commissioner for Budget and Economic Planning, Mr. Gogo Charles, noted that oil had distorted the picture of government revenue and made citizens to be laid back.
He also noted that since most citizens do not pay taxes, they do not bother what government does, or take government to task over its activities.
He expressed the belief that the new law would awaken the consciousness of the people to their responsibilities and take interest in government actions and activities.

Autonomy for the Board
The Chairman of the Board of Internal Revenue Onene Oshoka said autonomy for the service would instil confidence in the staff to carry out their duties and also help the board to build the capacity of its employees.
She assured the public that the board would not abuse the autonomy if granted in the new law, adding that the service would work towards making people to willingly pay their taxes.

Representative of the state auditor-general for local governments, Mr. Harry Ibinabo, also said the bill would enhance the revenue system.
He, however, said there should be the provision that the removal of chairman of the board should be approved by the state House of Assembly.

While most speakers at the hearing acknowledged the need to restructure the Board of Internal Revenue to make it autonomous, they, however, differed on the issue of involving consultants. In his address, the state chairman of the Trade Union Congress (TUC), Mr. Charles Onuegbu, said the union was encouraged by the performance of Amaechi and his efforts to raise the revenue profile of the state.

He said there was need for an overhaul of the Board of Internal Revenue because as constituted now, it could not meet the needs of the state. He, however, challenged the non-inclusion of representatives of the TUC and Nigeria Labour Congress (NLC) in the board, arguing that their non-inclusion was a ploy to exclude workers, who pay the bulk of the taxes, from the collection and management of taxes.
He therefore called for the inclusion of representatives of labour unions in the new board, as a means to ensure that their interests were protected in the new law being proposed by the state.

Use of Consultants
The TUC also opposed the use of consultants in revenue collection in the state, stressing that it would be counter-productive to the intentions of the state government.
He also decried the use of armed policemen and soldiers in forcible entry to peoples’ property and revenue collection, stating that it is undemocratic.

The representative of the National Union of Local Government Employees (NULGE), Mr. Behema Friday, also welcomed the bill but said the section dealing with local government revenue committees should be reviewed.
He said the composition of the committee should include the treasurer of the local government council. He also said the committee should not be autonomous but should derive its powers from the chairman of the council.

Speaking on the issue of consultants, a former Special Assistant on Revenue Generation in the Peter Odili administration and elder statesman in the State, Chief Sara Igbe, said engagement of consultants, such as banks, in the management of the state tax system was a veritable instrument in improving the revenue base of the state.

Igbe also said there was need for a link between the board and the state government, as well as other appropriate state organs to ensure checks and balances.
He expressed delight that the internally-generated revenue of the state had risen from N2 billion to about N6 billion, stating that the state had capacity to generate more than N10 billion monthly if the right machinery was put in place to check abuse and corruption.

CITN, Advocate of Review of Tax System
Representative of the Chartered Institute of Taxation of Nigeria (CITN), Mrs. Mercy Chuku, said the institute had over the years been an advocate of review of Nigeria’s tax system.

While she welcomed the move to restructure the Board of Internal Revenue, she recommended that the new law should specify that the executive chairman of the board should be a member of CITN. This, she said, would add a professional touch to the operations of the board and create a better impact. She also said there was need to include the self assessment system in the new law to boost the willingness of people to pay their taxes. The representative of the Ecumenical Foundation for Africa, Dr. Justina Ahme, stressed the need to make laws that would curb the excesses of the board of internal revenue.

She urged the assembly to ensure that there were proper checks and balances in the autonomy of the board to avoid abuse. She also advocated for a role for the attorney-general of the state in the board.

“Banks also have a crucial role to play because they have the experience and structure for revenue collection. They are less likely to abuse the confidence because they are also being monitored by the Central Bank. This is further check,” she said.

Josiah Olu Defends Bill
In an exclusive interview with THISDAY, Chairman of the Finance Committee of the Assembly, Josiah Olu, said the Rivers State Governor had introduced the bills that would aid the state’s efforts to intensify the drive to look inwards to generate enough revenue to run the state. He said the bills are the restructuring of the Board of internal Revenue bill and the bill to repeal and re-enact the board of internal revenue to make it autonomous.  According to him, “The major aim of restructuring of the Board of Internal Revenue is to make it autonomous so as to give it the bite to drive the process of revenue generation in the State. We have had a situation where the board is not really funded and also a situation of total dearth of manpower.

“So the aim of this bill is to restructure the board in such a way that it will be self-sustaining and also run like the bank, where you know that the stake is high and the competition is stiff and if you are a staff there you will know that we are going out there to get results. We are not going to do anything to contravene the law; we are not going to do anything that is outside the ambit of the constitution.
“The bill before the House is to enable the board run as a separate entity and not a subset of any ministry, what it translates to is that the board will fix its own salary with the approval of the state Governor, the board will fix the allowance that gets to the members. That way, if the members are working they will be happy and well-taken care of and that there is pension in place after their retirement, so it discourages the worker from trying to tamper with the fund that is generated. So the drive will be there to do that which is right as a staff of the board.”

He said the assembly was working with the Executive arm of government to improve the investment climate of the state to attract more businesses and investors. His words: “You see, even though we are different arms of government, the common goal between the Legislature and the Executive is to see that we have a better Rivers State.

“The bills mean well for the average Rivers person and resident. If you have a bill that is responsive, a bill that is sensitive to the plight of the people, because all over Rivers State we have had issues where people cry out that they were being over taxed; like we have 10 different types of taxes that are almost the same and you see a government sit back and say, listen we have to correct this.

“I think that government is responsive, and if you have a House a situation where you see friction between the House of Assembly and the executive arm, is where policies are not people-driven. But policies we have in Rivers State, if you can agree with me, are people-oriented; they are people-driven, they are cut out for the masses, for the average Rivers person. And I don’t think that any right-thinking assembly should be fighting an Executive that means well for the people.”

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