Two legislative proposals in the Senate are aiming to raise funds from the rich. Do the Abuja nouveau riche deserve this?
WHEN the idea of a befitting federal capital for Nigeria was first mooted in the 70s, the vision of the Federal Government was to have a capital with all the trappings of modern day civilization.
A model city that will have functional roads, good health facilities, and other social amenities that were hitherto absent in Lagos, the then sprawling capital of Nigeria; a capital city that is devoid of chaos and commotion occasioned by traffic gridlocks.
Little wonder, the founding fathers of Abuja picked a virgin land to ease the actualization of a model capital city. To actualize this lofty dream, the Federal Government came up with a master plan, which detailed how Abuja would be built.
However, with the master plan in place, the dream of the founding fathers of Abuja is fast being eroded. Public infrastructures that were meant to set the city apart from other cities in Nigeria are fast collapsing. The roads are becoming too congested due to heavy traffic.
Portable water is not readily available in most parts of the Abuja, except for highbrow areas like Maitama, Asokoro and Wuse. More so, good health and educational facilities are becoming hard to come by for residents.
Senate President, David Mark
Analysts attribute the chaos and collapsing infrastructures to two major variables. One is the high influx of people into FCT, and the other is paucity of funds to drive accelerated development.
Property tax bill
In response to these issues, the Senate Committee on Federal Capital Territory, intervened with two bills geared towards boosting the revenue profile of the city as well as restructuring the administration of the FCT.
The bills sponsored by Senator Smart Adeyemi, Chairman of the Senate Committee on FCT are FCT Board of Inland Revenue Service Bill and FCT Property Tax Law Bill. The two bills received support from the majority of senators who spoke on them during the debate on the two bills.
Among those who spoke were Senators Atai Aidoko, Ahmad Lawan among others with Senator Ben Ayaide arguing seriously against it. Leading debate on the bills, Adeyemi held that government alone could not continue to shoulder the burdens of the FCT.
He stated that for Abuja to be the dream city that all Nigerians would be proud of there was need for a parallel revenue generating agency that would sustain the city.
On the Board of Inland Revenue for the FCT, specifically, Senator Adeyemi said the board would boost the revenue profile of Abuja even as he lamented that the FCT was being shortchanged by unscrupulous public servants and their cohorts with 75 percent of taxes collected for the development of the FCT not remitted to government coffers.
He blamed this anomaly on the absence of law, arguing that the board would address this anomaly by having in place a well run agency that will track and collect all taxes meant for the FCT.
According to him, 'about 75 to 85 per cent of all taxes you see people collect in Abuja go into private pockets. That explains why it suits some senior staff of the FCT that we do not have a board of internal revenue. So it pays them that this law is not passed. But when you have a board in place, you can now sit down and articulate all the taxes and levies you are supposed to collect.'
Adeyemi while also introducing the property tax bill, entitled: 'A Bill for an Act to Provide for Assessment, Levy and Collection of Tax on Real Property in the Federal Capital Territory and other matters connected therewith, 2012,' was of the view that privileged Nigerians with properties in Abuja must be seen to contribute to the overall development of Nigeria through payment of property tax.
He said such taxes which are operational in other climes would help to boost government coffers. He said the law when passed would tax the rich to enhance the standard of living of the poor as a way of addressing the unacceptable high rate of unemployment ravaging the Nigeria economy.
Beneficiaries of the bill: 'This bill is targeted at the high brow areas of Abuja. Let them pay because they can afford it. Let's take from the rich people and provide for the poor. We are going to make sure that the proceeds coming from property tax will not be used to pay contractors constructing roads in Abuja. We are going to focus on development that will impact positively on the lives of the people of the FCT.'
Exemptions to the tax according to the bill include; 'Properties owned and occupied by a religious body and used exclusively for religious or congregational worship, religious education or similar purpose; real property owned by any person and used as a non-profit making cemetery or burying ground.
'But where the cemetery or burying ground is not immediately required for the interment of the dead it shall not be exempt from taxation hereunder until such time as the real property has been actually and acquired in good faith and at least in part used for the interment of the dead.
Both bills received wide support from Senators, as most of them stressed the need to make Abuja a self-sustaining city.
Senator Atai Aidoko, ANPP, Kogi noted that the bill would put the FCT on a self sustaining level instead of being a perennial drain on the nation's lean resources, adding that the bill would help decongest the city.
'With this bill, there will be enough funds to develop facilities in the satellite towns, thereby encouraging people to relocate and decongest the city centre.'
Also, Senator Ahmed Lawan, ANPP, Yobe said there must be transparency and accountability in the administration of the board when the bill becomes law. 'Those who are going to collect the taxes and levies must be very honest and transparent people. There is the need to make it impossible for the Minister to grant exemptions to some members of the public.'
Senators express mixed views
Few Senators were, however skeptical on the viabilities of the two bills, which they feared would impose severe tax burden on Nigerians, if passed.
Senator Ben Ayade, PDP, Cross River, argued that passing the bills would connote imposing more tax burden on Nigerians who he said were already being over taxed by the government.
Adeyemi however doused the fears that the revenues accruable through the tax laws and revenue board would be misused.
He said: 'I think it is proper that people who can afford it should be taxed. Even the little that is collected is not properly utilized. I think that is where the committees should come in to address where there are leakages.'
With the bills passing second reading at the Senate, it is expected that little effort would be needed for both bills to become laws and Nigerians remain expectant of having laws that would not only reduce the financial burden of the FCT on the Federal Government but also boost the economy through creation of more jobs.