Stakeholders link rising unemployment to economic meltdown

Dr. Olateju Somorin

Dr. Olateju Somorin

The rising unemployment and inflation have been blamed on the persistent slide in Gross Domestic Product (GDP) of the economy.

The President of Chartered Institute of Taxation, Dr Olateju Somorin, said in Lagos that Nigeria’s economy is currently facing a classical case of ‘stagflation’, a situation, which largely occurs when a country’s GDP is falling or stagnant, while unemployment and inflation are rising simultaneously.

Somorin, who quoted the CBN’s Governor, Godwin Emefiele’s assertions, added what the nation is witnessing in recent times is that tax revenue contribution to total government revenue continues to increase but with a low tax-GDP ratio of 3.98 per cent at 2015 levels in a N94.144 trillion GDP economy.

She said: “With government’s quest to achieve a 20 percent tax to GDP ratio, it leaves no one in doubt of the legion of Tax Administrators and Tax professionals required to navigate the tax laws on behalf of tax clients to ensure equity and fairness in its application and compliance. This onerous task falls on Tax Professionals who must continually update and display the requisite skill set in order to offer top notch services to their clients and the general public,”

According to her, the sharp drop in oil prices, has affected the Federation Account allocations to states, which has dropped by an average of about N2billion monthly per state.

“Therefore, at the federal and state government level, there have been increased activities geared towards increasing internally generated revenue with different strategies being employed, which some states have given effect to the institute’s call for autonomy for revenue administration in their respective states.

Also speaking, Professor Grace Olutunla, said for unemployment to reduce, government needs the four National Development Plans since independence (1962-1968,1970-1974,1975-1980 and 1981-1985), which achieved a lot in employment generation and wealth creation.

According to her, three or four Rolling Plans ‘era (1990-1992,1993-1995 and 1994-1996 and 1997-1999) also had positive impacts on employment generation and economic growth.

She explained that the National Economic Empowerment and Development Strategy (NEEDS), a Charles Soludo legacy, and their state and local government counterparts, SEEDS/LEEDS, have all promoted some employment generation from our human, material, capital and natural resources.

“While the individual and group lectures and speeches on how to fix the Nigerian economy are commendable, I think there should be a more coherent forum and strategy to make coordinated National Development Plans,” she said.

She therefore urged that the current government should revive the policy of national development plans so that the economy could successfully return to the path of economic recovery and growth.

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