Payment of Tax: More than revenue generation

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Abolanle Ogunlami

The term revenue generation refers to the process of making income to meet some basic needs. Revenue can be generated through sales of items, provision of services, rent, dividends, interest and sales return or discount. Without doubt, very little can be accomplished in society without capital as it empowers the government financially to carry out its major responsibilities and meet the basic needs of the people.  Poor revenue generation will automatically lead to deficit in government spending which can lead to inability to accomplish its lofty agenda.   Any failure according to Economist from the government may lead to legitimate public agitations to show displeasure.
Human beings from all walks of life including government at all levels, strife to generate income. Individuals and organisations generate revenue for self-gratification and expansion, while government generates revenue to meet up with its social responsibilities, geared towards ensuring the wellbeing of its citizens and promotes economic growth and all-round development.
Findings showed that taxes have been identified as one of the major sources of revenue, for unlocking the capital required by government at all levels to fulfil its social responsibilities.  However, taxation goes beyond revenue generation, as it has a lot of benefits for both the government and the governed.
Taxation in Nigeria dates back to the time when traditional chiefs served as tax administrators, when farm produce and other primary goods were collected from people as tax.  Modern tax administration is in line with the law/constitution which spelt out the taxing power of each tier of government.
Taxes payable in Nigeria, include Personal Income Tax otherwise known as Pay As You Earn (PAYE), Value Added Tax (VAT), Company Tax, Education Tax, Withholding Tax, Stamp Duty, Capital Gain Tax among others.
While the Federal Inland Revenue is responsible for administration and collection of the federal taxes like Company Income Tax, Withholding Tax on companies, Value Added Tax, Petroleum Profit Tax, States Board of Internal revenue take charge of tax collectibles at the states level. So in Ogun State, the responsibility of collecting taxes and ensuring payment by one and all, falls on the shoulder of the Ogun State Board of Internal Revenue.
As a service delivery organisation, with a vision to be the most outstanding revenue agency through commitment to tax efficiency under a friendly tax environment, OGIRS carries out its functions diligently, through different departments and units, such as, Road Taxes, PAYE, Consumption, Direct Assessment, Stamp Duty, Withholding Tax, Central Compliance, Informal Sector, Border Tax, Pools and Betting, etc. The agency is not relenting, in over-seeing tax payment activities in the state, while helping tax payers to discharge their tax obligations.
Backed by a Tax law, every tax payer in Nigeria is liable to pay tax on the aggregate amount of his/her income, whether derived from within or outside the country to tax authority at the state he/she resides.  What this means, is that the salaries, wages, fees, allowances and any other gains or benefits given or granted to an employee are chargeable to tax.  Thus OGIRS is the relevant tax authority for the discharge of Personal Income Tax obligation by all residents of Ogun State.
According to the State Taxes and Levies Approved List for Collection Act Amended Order 2015, taxes and levies collectibles, are Personal Income Tax (Pay As You Earn and Direct Taxation i.e. Self-assessment), Withholding Tax (Individual only), Capital Gain Tax (Individual only), Stamp Duty on instrument executed by individuals, Pools Betting and lotteries, gaming and casino taxes, Road Taxes (Riders permit, drivers licence, etc), Hotel occupancy and Restaurants consumption taxes, along with Development levy (Individual only), not more than N100 per annum on all taxable individuals. Whenever taxes are paid to the right authorities, i.e government coffers, a receipt is usually issued to the payee as evidence of payment which can be presented whenever it is required.
It is however unfortunate that Tax payers often see payment of taxes as a burden in its entirety, no wonder many evade tax.  Many see it as a means of generating revenue for government to embezzle, while some people also think it is a means of impoverishing the poor and making the rich more richer, and not necessarily of any benefit to payers.  Contrary to this attitude, people should know that payment of tax is an obligation with a lot of benefits.
Taxes should be paid voluntarily without any form of coercion.  When this is done, tax payers are obeying the spiritual command of being ones brothers’ keeper. For example, when the revenue from taxes are used to develop infrastructure in the state, provide social amenities like hospitals, schools, water etc., the ‘have nots’ will have the priviledge of better living standard, courtesy of tax payers contribution.
Apart from generating revenue for government, tax certificates can be used by payers to facilitate travelling documents when needed without any problems.  Visa application to some countries require that the beneficiary or his sponsor present evidence of tax payment for 3 preceding years to indicate that they are responsible citizens of their country or state.
Tax certificates may also come in handy and useful, when applying for certain loan facilities, other financial transactions and contract agreement by individuals or corporate organisations.
Payment of taxes in Ogun State, affords the payee the legitimacy to make demands on government, to be accountable in the management of the state’s resources while conferring on the citizenry the morality to force government to be responsible.
When documents like Land Purchase receipt/agreement, Certificate of Occupancy, Deed of release on Mortgage, Deed of Mortgage, Deed of Gift, Memorandum of Understanding, between individuals, Birth Certificate, Power of Attorney, Rental agreement and Deed of lease of property are stamped for example, apart from confirming legal status in the law, it also authenticate the documents, showing the backing of the state government.
Instead of seeing payment of taxes as a burden, citizens should see it as a duty which helps improve quality of their lives and that of other citizens.  Imbibing the culture of paying tax should not be a thug of war.  While it is necessary for payers to pay, it is also mandatory for government to collect for the good of all citizens.
ABOLANLE OGUNLAMI
Information Officer,
Ogun State Internal Revenue Service

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