REVENUE GENERATION: BEYOND COVID -19 TAX RELIEF By: Hon. Mike Igbo
The aim of any tax administrator is not to aggravate the burden of the tax payers at perilous times like these, rather, it is the tax agency’s responsibility to educate the tax payers, enlighten and sensitize them on the need to be fully alive to their tax obligations and be encouraged to build a positive consciousness of seeing tax payment as part of a strategic partnership towards development. At these perilous times, the Tax Administrator assumes the Administrator assumes the role of a first responder and provider of relief to the taxpayers.
However, while providing relief in emergency situations is essential in the short term, but what happens to the beneficiary of the relief in the longer term is of utmost concern both to the beneficiary and the benefactor. It is in this regard that the IRS commends the State Governor, Sen. Ben Ayade for approving a Tax Relief and incentive regime to assist taxpayers mitigate the impact of COVID-19.
The impact of COVID-19 pandemic has affected virtually all aspects of human endeavors. Economies all over the world were shut down in the quest to slow down and limit the spread of the Corona-virus, The pandemic caused economic distress throughout societies as workers could no longer go to work, many businesses, were either shut down or out rightly folded up as a result of the impact. Cross River State was not exempted. As a social corporate responsibility on the side of government, the Governor, magnanimously gave approval for some forms of tax relief to be granted tax-payers in the State in line with the guideline of the African Tax Administration Forum (ATAF) and the World Bank STFAS programme.
The State Internal Revenue Service as a revenue authority apart from strictly implementing CDC recommended measures to curtail the spread of the virus amongst staff and her esteemed taxpayers. It commenced the implementation of the approved palliatives to alleviate the economic distress that could affect taxpayers either big or small. According to the Executive Chairman of CRIRS, Mr. Akpanke Ogar, at a press conference, in conjunction with the State Ministry of Finance, “The tax relief regime of incentives has been provided by the State Government as one of the avenues for cushioning the effect of COVID-19 pandemic.
According to Ogar, ”the key contents of the package were developed with the extensive participation of various taxpayers’ segments and other stakeholders who have prioritized the areas of intervention required from government.” It is pertinent to know that, revenue generation goes beyond just granting waivers or tax abatement occasioned by the dire need to cushion the effect of the pandemic; We should also see revenue generation as encapsulated in tax collection as a viable option for sustainable development even after the COVID period.
While taxpayers are enjoined to see the tax relief as a good gesture from government to cushion the effect of the COVID-19 Pandemic, Government on its part should develop, and use this period to re-strategize for post COVID19 era, as we enter 2021. The strategy should be, building infrastructure and attracting businesses to the state. The time has indeed come for us to remind ourselves that government can only meet her obligation to the citizens if the
citizens play their own part by paying their taxes. For government to collect taxes they must justify their position for tax collection. Government must create prosperity for the taxpayers. There must be a strategic alliance between the public sector and the private sector to support the survival of our fragile state economy occasioned by our delisting as
an oil producing state. In 2021 we cannot afford to depend on allocation from the federal coffers. It is obvious that priorities in terms of revenue generation will change in the emerging post COVID-19 era starting from 2021 and the world will begin to focus on what is really important. Luckily, Cross River State is blessed with abundance natural and human resources which is begging to be harnessed for the benefits of the citizens of the State.
Kudos to the Agro revolution of this present administration. This implies that we must make internal revenue generation a top priority for the State. There is no doubt that no government will continue to provide tax waivers for individuals and corporate organizations for a very long time. The reality of the state 2021 budget is enough impetus to make internally generated revenue a key priority. Given the massive drop in government revenues, government should therefore, begin to engage the taxpayers in strategic town hall meetings, where the imperative of their contributions as partners in the development process of the state will be highlighted. This will invariably aid voluntary tax compliance in the post COVID era and beyond.
This window of waiver granted to taxpayers has a definite timeline which at most will expire in December 2020, with exception to the tax exemption law for low income earners in the State. It is therefore expected that taxpayers should reciprocate the good gesture of government and prepare themselves to resume their civic obligations of paying their taxes in 2021 to enable government serve us better.