Nigeria’s minister of finance, budget and national planning, Zainab Ahmed, said the Federal Government is drafting a Strategic Growth Revenue Initiative (SGRI) 2.0 to improve Nigeria’s revenue to gross domestic product (GDP) in the next three years.
Ahmed said the government plans to increase the revenue to GDP from 6 per cent to 15 per cent by 2023.
According to Ahmed, despite this projection, Nigeria is still lower compared to other African countries such as South Africa, Kenya and Ghana, she said during an economic outlook organised by Deloitte on Thursday, which focused on “Building a resilient economy for the future.”
The three countries had hit 29 percent, 18 percent and 14 percent revenue to GDP, respectively since 2018. To push Nigeria closer to other African countries, Ahmed stated that the SGRI, which is still being drafted, will enable the country mobilise and utilise revenue sources, and diversify the economy away from oil by 2025.
The Ministry, Departments and Agencies (MDAs) will be given targets to enable the government meet its projection for revenue to GDP. The government plans to achieve revenue growth through 47 different initiatives that include;
Identifying new taxes, broadening of the tax base, expansion and improvements of value-added taxes, closing of legal loopholes, collaborating trading partners, data collection and analytics, targeting of High Networth Individuals (HNIs), and improving tax compliance.
But Ahmed said the drive to increase revenue is focused on improving tax administration and compliance, not creating new taxes or increasing value-added tax, but didn’t rule out increase in taxes.
“We have a plan to support small businesses and manufacturers, as such our initiatives are centred around improving tax administration and tax compliance and not introducing new taxes,” she said.
While explaining the buildup, Ahmed said, “The SRGI is a bottom-down approach that is driven by enhanced data and technology to complement a bottom-up approach aimed at improving operational efficiencies.
“Each area of the new initiative will be monitored with clear deliverables, KPIs, targets and timelines assigned to the relevant ministries departments and agencies for the implementation of results.” the minister said.
She said the strategic initiative and the Finance Act 2020 will help Nigeria exit the recession by about 3 per cent. The SGRI is also expected to grow fiscal revenues, improve the ease of doing business, counteract the impact of oil price fluctuations and integrate fiscal, monetary and trade policies.
By Fakoyejo Olalekan…
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