A charity organisation, Oxfam, has criticized the International Monetary Fund’s (IMF) Article IV, persuading the Federal Government to boost the current 7.5 per cent Value Added Tax (VAT) and remove subsidy on fuel to “promote long-term growth”.
This was contained in a statement by Oxfam, in Abuja, yesterday. Oxfam said medium to long-term recovery efforts should stimulate fiscal and policy space that permits for rise rather than decrease in social spending, and progressive tax policies that collect sufficient revenue and redistribute wealth fairly.
According to Oxfam Country Director, Dr. Vincent Ahonsi: “A sharp increase in VAT will widen the inequality gap in Nigeria and may plunge more Nigerians into extreme poverty. In Nigeria, the two richest billionaires have more wealth than the bottom 63 million Nigerians.”
“Instead, Nigeria should tax the wealthy and invest the trillions that could be raised into social services and infrastructure, climate adaptation, improvement of early warning systems for extreme weather, helping poor farmers to buy weather-indexed crop insurance, and researching seeds that can better cope with droughts.”
Furthermore, the organisation said rather than putting further pressure on the bottom 99 per cent of Nigerians, government should “claw back the gains made by billionaires by taxing the huge new wealth made since the start of the COVID-19 pandemic through permanent wealth and capital taxes.”