FROM Lagos to Ogun, Osun and Ekiti states, public service workers are groaning under a crushing tax policy imposed by the respective governments of the various states.The states under the Action Congress of Nigeria (ACN) appear to have silently adopted a common front of taking taxes from workers in a proportion workers now see as inexplicable and unbearable. In these states, workers complain of 300 per cent hike in their Pay As You Earn (PAYE) tax. The various state governments are however, keeping a straight face stressing that workers could not demand and have the new minimum wage without paying enhanced tax on same.A common accusation across these states is that the new tax regime was designed for them by a company often linked with the former governor of Lagos State, Senator Bola Tinubu. However, mum was the word in these states when the Nigerian Tribune sought to know their relationship with this company vis a vis their tax policies.OgunIn Ogun State, the Senator Ibikunle Amosun-led administration has implemented a new tax regime increasing the Personal Income Tax of workers in the state by 300 per cent. This issue has generated a lot of accusations and counter-accusations between the state government, the Nigeria Labour Congress (NLC) and the Trade Union Congress (TUC) as the organized labour unions alleged that the state government hiked the income tax by 300 per cent or more. The NLC's 21-day ultimatum notice served on the government lapsed on Wednesday, as labour vowed to resist what it described as 'arbitrary' increase in form of tax on their income. The State Chairman of the NLC, Comrade Hakeem Ambali, condemned the proposed tax increase, contending that it was against the existing tax law in the state. Ambali said that the new tax regime was basically on the gross income of workers instead of their basic income and vowed that the new tax would be vehemently rejected.OsunIn Osun State, a circular letter dated September 9, 2011, introduced a new regime for the public service and backdated its effective date to March 2011 for Grade Levels 01-07 while GL 08-17 was effective from August 2011. The new tax ranges from N19,012.95 for GL01; N19,339.02, GL02; N19,616:71, GL03; N20,083.03, GL04; N21,129.73, GL05; N22,360.71, GL06; N27,086.63: GL07; N33,798.79, GL08; N39,838.53, GL09; N46,901.26, GL10; N51,821.62, GL12; N55,807.23, GL013; 58,427.23,GL14; N87,751.23,GL15; N117,752.88, GL16; to N125,648.13 for GL 17.EkitiSources at the state civil service told the Friday Edition in Ado Ekiti, the Ekiti State capital, that the tax they were paying had eaten deep into their earnings.A top civil servant in the state said 'we just got a circular informing us of the new tax regime. We do not know where it was prepared and who prepared it. We also do not know how they arrived at the percentage of the current tax. But it is far higher than what we were paying and we are not happy.'The source said: 'The Accountant General's Office prepared a tax and it was rejected by the government. They told us to go back and prepare taxes according to the new tax regime. The new tax regime came with the approval of the relativity pay by the state government.''In May, civil servants on Level 8 step III paid as much as N2,367 as tax monthly by male workers and as female workers usually pay more as tax, theirs would be higher. And this was in May before the new tax regime, so imagine how much they would be paying now with the new tax regime.''Another issue in the tax matter is that the payment was backdated and the deductions started in September. However, August and September salaries were taxed, with that of August taxed in retrospect. I never knew that salaries that had been collected could be taxed at another time. It is absurd.''Some of those who had collected car and housing loans take virtually nothing home. For example, those who are on Level 12 and pay over N12,000 as tax, when their loan deductions are made and they have less than N12,000 left as taxable pay, the shortfall in the tax is drawn from their contributions at the CTCS. So, you get no take-home pay and on top of that, your contribution in the cooperative society is deducted as tax. That is what the civil servants are currently facing in Ekiti State.'The labour unions have kicked against the tax regime because of the amount, but they said they have postponed their fight over the matter till after the new minimum wage has been implemented in the state.However, efforts to find out the particulars of the tax consultants in the state yielded little results. While some sources agreed that the state had a consultant collecting the tax, many others denied knowledge of the existence of one.EdoAs part of its effort at fast-tracking the development programmes for Edo State, Governor Adams Oshiomhole has evolved a new tax machinery to give effect to proper taxation and collection of taxes in a manner that would fetch the state, a monthly Internally Generated Revenue (IGR) of N2 billion from consumption tax.In the new tax regime, the state aims to achieve proper taxation, collection and remittance which would galvanise the IGR profile and provide needed funds to prosecute the development projects the governor has embarked upon for the people. The state presently generates N1.3bn from IGR monthly.In Lagos, workers there appeared to have got used to the unusual taxation said to have been on in the past five years.Oyo and Ondo are perceived to be quiet for now but a source said governments there are putting finishing touches to their own tax policy.In the middle of the tax controversy in Nigeria, especially in the South-West, is a company often associated with former governor of Lagos State, Chief Bola Tinubu. The company, AlphaBeta Consulting, registered as a limited partnership. It states on its website that it does business with a number of state governments, with Lagos topping the list. Others, according to the website, accessed on Monday, October 10, 2011, are Kwara, Kano, Imo as well as some agencies of Enugu state and Abuja Environmental Protection Board.According to the company, its services to Lagos include ' monitoring and co-ordinating all revenue generating activities of the state.The company further claims that 'it increases the Internally Generated Revenue base of Lagos State , provides easy administration, monitoring and co-ordination of all revenue activities in the state and assists to identify fraudulent debit, diversion of funds and excess charges on the state accounts.A source in Osun State said a subsidiary of Alpha Beta, Infinity Systems, is currently in Osun working on its information network system that will link the tax stations and its head offices in Osogbo and Lagos to lodgement banks. In the South-South, apart from perhaps Rivers State , tax revenue is never taken as a priority and so the use of consultants is ruled out, at least for now.The Taxes and Levies (Approval List for Collection) Act 1998 authorised states to collect the,personal Income Tax in respect of Pay As You Earn (PAYE), Direct Assessment, withholding tax (individuals only), capital gains tax, stamp duties on instruments executed by individual, Pools betting and lotteries, gaming and casino taxes and road tax taxes.SokotoThe current tax regime in Sokoto state is being operated through indirect payment of taxes to the state board of internal revenue whose tax collection system has now been fully automated for greater results, the boards director of revenue, Alhaji Musa Maccido, has said.Maccido who disclosed this to Nigerian Tribune in an exclusive interview Sokoto, added that the board was carrying out tax audit after every 6 years with a view to recovering all outstanding tax payments due to board by firms, companies, contractors, businessmen and individuals.He said the board entered into a tripartite arrangement with the Federal Road Safety Commission (FRSC) and the office of the state Vehicle Inspection Officer (VIO) for the speedy enforcement of tax payable to the board and was also in liaison with state ministry of finance for payment of Pay As You Earn (PAYE) tax by civil servants as well as the tax accruing from contracts issued by the state government.KadunaThe Kaduna State government says its Internally Generated Revenue will hit about N6.7 billion. According to the Executive Chairman, Kaduna State Board of Internal Revenue, in an interview, the board has made progressive increase in its IGR, since the inception of the administration. It attributed the development to certain innovations as well as the blockage of loopholes through which staff had collaborated with tax payers to defraud the government. It refuted reports that state governments planned to increase taxes, insisting that the recent meeting of governors on the matter was to examine ways to empower their tax authorities so that they can improve on IGR through improvement in efficiency and not increase taxes.KatsinaIn Katsina State, investigations revealed that, revenue is generated from personal income taxes, with-holding taxes, road taxes and fines and fees taxes. There has been no increase in these taxes and rates.survey, as well as the commerce ministry.
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