By Zayyad I. Muhammad
Taxes and royalties collection is a fundamental avenue for a government to generate revenues to fund infrastructure and human capital development.
Adamawa State needs other sources of revenue apart from the free petro-dollar from the centre. The state is poor, with a fragile economy, including thousands of unemployed youths and people engaged in unproductive jobs.
The World Bank says – most developing countries with fragile economies “often face the steepest challenges in collecting taxes.”
There is a correlation between the timing of introducing new taxes, peoples’ economic strength and politics. No government can survive local politics if it introduces new taxes at the wrong time- especially when it faces a re-election bid. Governor Ahmadu Umaru Fintiri is seeking re-election in the 2023 governorship election.
Governor Ahmadu Umaru Fintiri’s introduction of a new cattle tax regime appears ill-timed, unplanned, and poorly communicated to the concerned people. So many explanations from the Governor’s aides, yet no one understands them because the basics in tax administration were left out – new tax collection should be optimized, but with minimal burden on the taxpayers, it should be fair & equitable, and at the appropriate time.
The Adamawa state government said that the ‘Adamawa State Agribusiness Support Programme (ADAS)’ is designed to take full advantage of the agricultural opportunities within the state and will focus on three areas of the Crop Value chain, Livestock and Aquaculture. The government further said – the Agric bond will draw twenty-five billion Naira annually, which will be used to offset many of the state’s liabilities and loans, and open a window for generating huge revenue as well as galvanizing the market in the Agric business, especially the livestock subsector” including the upgrade of cattle markets in Mubi, Ganye, Song, Gombi, Ngurore, Tungo, Malabu, and Wuro Bokki.
The Fintiri government failed to do its homework in two areas – balancing the economic needs and political necessity. The cattle tax is as historic as northern Nigeria. The five thousand Naira (N5,000) imposed on every cattle is exorbitant and unaffordable according to many people in the business
On the other hand, there are thorny politics associated with the cattle tax’, and the people related to the business are complex and critical in the socio-political settings of northern Nigeria, thus before tinkering with the tax, there is a significant requirement for discussion, engagements, and understandings. The livestock business is a vital sector, so to speak! as a result of poor timing and lack of discussion with stakeholders on the new increase in the cattle tax, the Mubi cattle market, one of the biggest in the north, didn’t operate last week. The security agents sealed the market on Tuesday, September 13, 2022.
Well, the Governor has found himself in a catch-22 situation because the upward review on tax for cattle and grains was one of the conditions the government must fulfil in accessing the capital market’s 100 billion naira agribusiness bond. Governor Fintiri has already collected 25 billion Naira from the 100 billion. And the investors are the ones to be collecting the taxes
Governor Fintiri is a history, policy, and strategy student, but often some of his decisions lack political strategy. He doesn’t have good political advisers or seeks any advice most of the time.
Zayyad I. Muhammad writes from Abuja, 08036070980, email@example.com.