Ogun Govt Targets N3.1bn Revenue From Informal Sector

Ogun State To Host 7th National MSME Clinics
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The Ogun State Government says it is targeting over N3bn additional revenue from the informal sector of the state economy as it enlists about one million residents from the sector into the tax net.

The Chairman of the State Internal Revenue Service, Mr Kunle Adeosun, made this disclosure during an interview with journalists while on a road show to markets and motor parks where he enlightened residents on the Voluntary Assets And Income Declaration Scheme in Abeokuta, the state capital.

“Our target in the informal sector is to at least quadruple what we get in payee because that is where the volume is. In Ogun state, the population is put at about seven million and out of those seven million, people taxable is roughly 40 percent of that,” Adeosun said.

“So out of those 40 percent, if we can get just additional one million people in the informal sector, then we are home ground. Minimum tax there is 3,100 and if you multiply that by one million people, that is over three billion. That is on the average.” he concluded

While asking residents to show better understanding with the government as the scheme gradually takes effect, Mr Adeosun said that the state government will apply the full weight of the law against defaulters

”The federal government launched the Tax Thursday about two weeks ago. Part of the scheme is to run enlightenment on Voluntary Asset and Income Declaration Scheme. Every Thursday has now been designated as Tax Thursday until next week when the amnesty programme ends.”

”In all locations, we will be running this every Thursday just to make sure that we draw more enlightenment for people to come and file all the assets and income they have not declared in the past and to take advantage of this amnesty programme,” he said

He explained that the government is not only targeting the informal sector but everyone that has assets and income they have not declared in the past.

“Even if you are a payee, where you pay your tax but have investment income like a gas station or rentals, you are supposed to pay taxes on those other businesses in addition to the payee you do,” he said.

”There is punishment for defaulters but if you come and declare voluntarily during the tenure of this scheme, you will not face a penalty but once the scheme ends, then it is back to the enabling law which allows for penalty, interest and jail term.”

Unemployment: Nigeria Needs More Venture Capital Firms – Nweze

Austin NwezeA professor at the Pan Atlantic University, Austin Nwaeze, has urged the Nigerian government to emulate Israel’s system of funding small businesses, which will in turn create more jobs for the largely unemployed populace.

“In Israel, as small as it is, they have close to (between) 240 and 300 venture capital firms. These are the people that can understand risks,” he said, noting that conventional banks do not have the capacity to understand such risks.

Following the recent announcement by the National Bureau of Statistics, about the number of jobs created in 2014, Nweze commended the agency for its pro activeness under the current government, noting that unemployment figures are needed to help the government plan and also make policies to improve sectors providing jobs.

He noted that the informal sector, which had created more jobs in the past two quarters, needed a lot of attention as “government cannot create jobs”. He stressed that it is “entrepreneurship that creates jobs.”

According to him, small business make up the “engine growth of any economy” and if they do not thrive, the economy is headed for a fall.
“So we need to begin to make policies that would make it possible for this sector to grow”, he noted, berating government’s method of “encouraging small businesses to grow.”

He noted that funds were not available to small businesses and the problem of multiple taxation had not been eliminated.

Although President Goodluck Jonathan recently launched the National Council On Micro, Small and Medium Scale Enterprises to solve the prevailing problems, Nweze opined that the council would still demand “an arm and a leg” in exchange for loans.

“The thing is that, we are making a mistake by solving a problem by creating more problems. Now, until we begin to recognise the importance of Venture Capital firms, private equity firms.

“These are the people that will help. They have helped create finance businesses, encourage entrepreneurship.