Tax Is Vital For Proper Governance, Says Finance Minister

The Minister of Finance and Coordinating Minister of the Economy, Olawale Edun has stated that tax collection is vital for the government to perform their responsibilities in the country.

Edun made the statement during a bilateral inter-ministerial meeting with the German Minister of Economic Development and Cooperation, Svenja Schulze, and the Minister of Industry Trade and Investment, Doris Uzoka Anite. The meeting was held in Abuja on Tuesday.

He reiterated on the importance of tax collection in facilitating government responsibilities, including investment in social infrastructure and services.

The Finance Minister also disclosed that Nigeria's tax-to-GDP level stands at a mere 10%, which rises to only 13% when accounting for states, positioning it among the lowest globally. He contrasted this with other African countries, where the ratio hovers around 25%.

He highlighted the disparity by noting that in developed nations, the tax-to-GDP ratio exceeds 50%, enabling significant investments in social infrastructure, welfare, and more.

While addressing the economic challenges in Nigeria, Edun stressed the necessity of growing the economy, increasing productivity, creating jobs, and reducing poverty. He cited interventions by President Ahmed Tinubu in the agricultural sector, aimed at stabilizing prices by providing support to farmers and bolstering production of key crops like rice, maize, wheat, and cassava.

In response, Svenja Schulze stressed on the importance of fostering bilateral relations between Nigeria and Germany, acknowledging Nigeria's vibrant youth population and underscoring the mutual focus on addressing issues of job creation, food security, and education. 

She however expressed Germany's commitment to deepening ties with Nigeria.

Also speaking, the Minister of Industry Trade and Investment, Doris Uzoka Anite echoed the sentiment, highlighting Germany's interest in skill-building and education for artisans, areas ripe for collaboration under the MSMEs framework.

The meeting concluded with plans for the signing of a Memorandum of Understanding (MOU) to streamline planning and decision-making processes between the two nations.