OPS faults 0.5 per cent tax on profit for governmet agency

The Organised Private Sector (OPS) has kicked against the insertion of 0.5 per cent tax on its profit to fund a new agency, describing it as deterrent to growth of business.

The group comprises the Manufacturers Association of Nigeria (MAN), Nigeria Employers Consultative Association (NECA), Nigerian Association of Chambers of Commerce, Industry, Mines & Agriculture (NACCIMA), National Association of Small and Medium Scale Enterprises (NASME) and National Association of Small Scale Industries (NASSI).
 
OPS maintained that the newly imposed tax, added to more than 55 taxes and levies already in existence, imposed on enterprises from council to Federal Government level would only deteriorate business growth and intensify unemployment if the “draconian” fiscal framework is not reviewed.The Director-General, NECA, Olusegun, stated that enterprises and businesses are being unwittingly strangulated by a hostile, unfriendly and very unreasonable tax and levy regime.

According to him, the trend has continued, as evidenced from the recent Federal Competition and Consumer Protection Bill submitted by the National Assembly to the President for his assent.He maintained that some retrogressive forces have gone behind the stakeholders after the public hearing on the bill to insert a 0.5% tax on companies to fund the establishment of the planned Commission/Agency that will undertake responsibilities under the law.

“The private sector actively supported the introduction of a dispensation where an institution will exist to promote fair, efficient and competitive markets in the Nigerian economy, but at no time during the public hearing on the Bill, did we discuss the imposition of 0.5% profit after tax on all companies operating in Nigeria, as a source of funding the commission.

“This provision was not contained in the draft bill that was exposed to the public. So, what could have been the source of this obnoxious provision that seeks to further drain life out of a struggling and comatose private sector that is still laboring under the unbearable weight of multiple and overlapping taxes and levies?” he said.
 
The NECA boss, who described the tax insertion as fraudulent, stressed that the OPS seriously frown at the act.“We do not support it. We will not accept it. If not removed, it may signify the death knell for this intended dispensation, as the private sector will not pay an unnecessary additional levy/tax. We implore government to fund this agency from the existing fiscal framework. 

“We wish to let Mr. President know that there is a fraudulent element in the procedure adopted by the National Assembly in forwarding the said bill for his assent. The obnoxious provision on funding, which was surreptitiously inserted, is too fundamental not to have been contained in the draft bill exposed to the public. 

“We urge Mr. President in the interest of this economy and sustainable development of Nigeria to withhold assent to the Federal Competition and Consumer Protection Bill 2016. The Bill should be sent back to the National Assembly for proper procedural compliance,” he added.