At the First Gate Bus Park opposite Iba Estate in the outskirts of Lagos, where buses load for Iyana Ipaja, Paul, a driver, who operates an 18-seater bus, told NATIONAL ECONOMY that he makes a maximum of N4,000 daily, although he charges N300 per seat.
Typically, a to-and-fro movement is supposed to earn Paul N10,800. He said he buys N1,500 diesel to fuel his bus for the day. Out of the remaining N9,300, he pays N5,300, which is 49 per cent, in taxes and levies to touts and unions. Paul says he has to eat and maintain his bus from the N4,000 he earns daily.
Paul’s situation is not an isolated one in Nigeria. The menace of multiple taxations by illegal and most times, criminal elements is becoming ever pervasive and choking all sorts of micro, small, and medium-scale enterprises out of business. While some state governors claim to be doing something about curbing the financial crime being meted upon struggling Nigerians, there is hardly any evidence yet, that anything significant is being done.
The menace is prevalent in the transport sector where touts operate in the name of different unions and collect tolls supposedly on behalf of the state government.
Although Governor Chukwuma Soludo, said his administration was addressing the menace of multiple taxations by evolving a progressive, simple, and technology-driven tax system that would eliminate touts and reduce the burden on businesses, the menace remains unabated.
Soludo had assured that touts would be eased out of the way because these people collecting the multiple levies are illegal agents who ensure that 90 per cent of the money collected enters private pockets, not the government.
John Emefiele, a bus operator, said thugs are still collecting multiple levies and that the effort of the Anambra State government to centralise the collection had not been effective.
Emefiele said though the government had directed them to pay a one-off levy every month, touts had continued to collect money from them every day as union levies.
“The problem of multiple levies coupled with the high cost of petrol and vehicle maintenance is affecting businesses,” he said.
A filling station manager, who pled anonymity, said they were charged levies on different revenue heads which were merged into a consolidated tax.
Patience Irobi, a shop owner, said traders in Anambra also faced cases of multiple taxations.
Precious Metu, also a small businesswoman, said they paid levies under various heads including storage fees, market development, market traders’ fee, pollution/sanitation fee, biometric market registration, and market operation fee.
In Ebonyi, business operators said the development was causing difficulties and setbacks to their businesses, ranging from an increase in purchasing prices of items to and generally harsh economy.
They urged the federal and state governments to put the activities of tax collectors on serious check, especially those on the highways and within the state.
They alleged that between three and four taxes were being made randomly.
Mr. Ukasha Muhammed, a goat dealer and resident, stated that monitoring the goat dealers’ activities would enable the government to ascertain and tackle the challenges.
He said the multiple charges on the highways include haulage, veterinary services, and transportation among other charges.
According to him, “We spent between N10, 000 and N50, 000 as total expenses on each animal (goat and cow) from the point of purchase.
“After multiple taxes and levies experienced on the highways, when you come down to the state, you will pay another set of taxes, making goods to be costly in the market.
“The revenue collectors in the state are not helping us. We pay between N300 and N3,000 IGR for each goat and cow,” Muhammed explained.
Another dealer, Mr. Haruna Sariki, alleged that most of the collectors posed as public and private revenue officials and imposed multiple taxes on businesses.
Sariki urged governments to check the excesses of illegal roadblocks in the guise of revenue collection along highways as well as imposters in the state that frustrated business operators.
He said a goat is sold between N70,000 and N150, 000, depending on the size as against N25,000 and N45,000 due to multiple taxations.
He further said that the multiple taxations for a truckload of cattle often amount to N1.8million as against N600,000.
Some of the taxes and levies are introduced by market leadership, local and state governments.
The taxes/levies included: security levy, sanitation levy, annual levy as well as late packing fine/levy.
The situation is exacerbating as new levies are being introduced and their collection is done fiercely daily; these levies included: daily wheelbarrow hawkers’ permits and daily ground space levies among others.
Mr. John Okezie, a petty trader within Mayor Market, Agbani Road, noted that the burden of taxes, especially the ones paid daily, was becoming overwhelming on traders, who at times experienced low patronage.
A PoS operator, Joy Iyaze, lamented that the effect of multiple taxations was really biting harder on Small and Medium Enterprises in Lagos State and Nigeria at large, as it denied the enterprises the opportunity to expand.
Iyaze said struggling SMEs were forced to pay all sorts of levies, ranging from land rate, water rate, and other undocumented taxes.
“It is painful, especially with the current increases in transportation caused by the hike in petroleum products,” she lamented.
Nigeria has the second least tax-to GDP-ratio in Africa, only behind Eritrea, and among the least in the world; but Nigerians are arguably among the highest taxed in the world. Most of the taxes and levies end up in private pockets.
The few elements that collect illegal taxes and levies inflict hardship on the larger population in the form of biting inflation.
The National Bureau of Statistics (NBS)recently released inflation figure that showed a 21.9 per cent year-on-year rate.
Experts said apart from insecurity and poor infrastructure, a major contributor to the high rate of food inflation is multiple taxations on businesspeople because they add prices to their goods and services to make their margins after being taxed by unscrupulous elements.
An economist, Deborah Bemah, told NATIONAL ECONOMY that the annoying aspect of such illegal taxation is that they do not get to the coffers of the government; they only end up in the pockets of a few people and must be paid for by the struggling masses.