New Telegraph

Musa: Countries don’t develop through taxation

Dr Oluwasegun Musa, a seasoned maritime expert and transport planner is the Group Managing Director of Widescope Group of Companies and CEO of Global Transport Policy. In this interview with PAUL OGBUOKIRI, he condemns the tax for revenue policy of the President Bola Tinubu administration and further called for a committee of public and private sector players to drive the national single window project

What is your view on the present economic policies of the government?
What we’re doing presently is killing, not building the economy. If you look at all the existing policies now, they are policies that will kill the economy; none of the policies drive and grow the economy.
Number two; there is nothing to ascertain that the intention of the government will actually advance the development of the economy. So, we operate based on assumptions that are far from reality. You know, when you put something on black and white, and you’re just reading to the public without any action backing it up, it’s just a hypothesis that whether it will work or it will not. What we are witnessing is a trial and error government.
There is no country in the world that developed through taxes. It is only a government that lacks capacity to think that resorts to taxation because taxing the people is the laziest way to raise revenue.

What is your take on the single window project?
I’m happy to be one of the pioneer non-state actors that attended the training in Guadalajara, when the idea first came up.
And at that forum, after the training, the media engaged us to seek our opinion as at that time as Customs was pushing, pretending that they were doing the right thing. I was the lone voice that tackled them.
I told them that taking into cognisance what we’ve been taught on the integrated platform, which we refer to as Single Window; we cannot allow the Nigeria Customs Service to superintend it. One of the Customs officials said that I should have supported Customs but I said, ‘no. I don’t support what is wrong; Customs does not have integrity unless we want to deceive ourselves.’
And if truly we want to develop the economy, we must tell ourselves the truth, regardless of whoever is going to benefit from the change in the system. So, I said, ‘no, we can’t’. And we wrote a lot of petitions. We’ve been on it for quite a long time.
Government now handed it over to the Federal Inland Revenue Service. Unfortunately, the Federal Inland Revenue Service does not also have integrity. So, what we’ve proposed to the government now is to have a committee of the state actors and non-state actors with maximum integrity to superintend over it.
And that’s the only way we can convince the international community that we’re serious. Because the first thing the international community will do when you are bringing such an idea is to check the background of the private sector or agency or ministry or whoever is going to be superintending over it.
If there’s a question mark, they will lose interest. The world has advanced beyond the day of when you tell stories and you tell people about your stone-white information. Nobody listens to you.
It’s not like when you are in a location and you want to be a guest speaker. When you are called upon to come and address the audience as a guest speaker, you see a lot of people. When they announce your name, the first thing everybody does is just pick their phone. They are not chatting. They are checking your background.
If they find anything questionable in your background, they will not even listen to you. They won’t pick interest. That is the level we are now.
That’s why when the NBS comes up with their statistics, everybody will just laugh because NBS also does not have integrity that they want to showcase globally.
The issue of integrity is a very crucial and very important issue and it is a scarce commodity. So, if you are going to base superintending the single widow on integrity, who or which agency has that integrity to superintend because of the way it’s being practiced. We have agencies that are having some questionable integrity. What you do, you use them to check each other.
You now bring people of integrity from among the non-state actors to also be there because they have a stake. If anything goes wrong, it affects their investment.
For instance, if you bring in Femi Otedola, Mike Adenuga, Aliko Dangote, you identify all those people that have investment that if anything goes wrong, their investments and businesses will be affected. How much do you want to bribe them with? They would not want to have anything to do with the integrity of their business empire. That’s how to put checks in place. But for a single servant to protect what they have nothing to lose, no matter what happens, the worst scenario is that you will sack them.
So, it’s not a platform that you just outsource to all those civil servants that have nothing to lose and that’s why I propose to the government that there must be a formidable committee that will include the state actors and non-state actors. Let’s see who is going to compromise the integrity on such a platform.

These big private sector figures you mentioned their names won’t be able to be there in person to oversee the day-to-day running of the project. Will they?
I know. If you are the chairman of a board in any company, regardless of whether you are a multi-billionaire or anything, even if you don’t chair the board meetings, you put somebody up by proxy. If anything goes wrong, you may have responsibility. And that’s why you must ensure whoever is going to be your proxy must be of integrity. So, you won’t want to compromise it. You look for the best hand to represent you if you won’t be available. And this is not the kind of arrangement that is full-time work.
You meet maybe once in six months or once in a year to appraise performance, to look at what they are doing, and send notes to you. You have your own PAs, your advisors that will also check for you before you give approval for anything.

So, would you rather have the private sector run the single window project?
I am proposing a combination of the state actors and non-state actors. It should be a kind of committee of persons with high integrity. I know it’s working in Ghana and other countries. All we need to do is to put what we call deterrence in place. When you are setting up a committee, if there is no deterrence, everybody will play the way they like. But if there’s a form of deterrence in place, that will serve as a form of checks and balances. That’s how it works all over the world and they are not better than us. They have deterrents, checks and balances unlike here, where men get away with so much and sanctions are very scanty.

How will you relate with Customs and the high revenue target it has been asked to meet in 2025?
Our concern has been how we ensure we support importers to bring in more shipments, which of course, has drastically reduced in recent times. By the time you bring up a policy that kills their business, they will stop importation. When they stop importation, you put pressure on the remaining importation coming in.
Rather than them paying $1, you push $2 on them because you now go on the internet. You tell your officer, go on the internet, go and look at the window price and slam it on importers. And when they slam the window price on the importers, there’s no one to report to because it is the same Customs that wants to maximize revenue that you will go and report the officers. They say, resolve the matter. And if you don’t quickly resolve that matter, you will realise that the money you are supposed to pay, you are paying it on storage.
The money you are avoiding to pay, you pay it on storage; you still come back and pay that duty. So, a lot of customers will both compromise and say, ‘okay, what do you want us to do? Should we divide this money? Should we share it into three? Should we do this and that?’ That’s how people are compromising because the Customs are creating room for compromise.
So, in very simple terms, we do not need a system that allows Customs to believe that they have a monopoly of knowledge. All of us, we have knowledge.
What Customs know, I know. What the Standards Organisation of Nigeria knows, I know it. In fact, all the agencies that have something to do at the port know, I know what their roles in the ports are. But what I know, they might not know it.
I’m a midwife between them. That is why I’m called a broker and a professional freight forwarder because I relate with all of them and all their books, I memorize them. So, whatever, like talking about components of freight, Customs does not know.
Customs will only tell you, ‘ah, the freight is supposed to be $6. It’s supposed to be $5.’ They don’t know the component of freight.
They don’t know that the higher the volume, the lower the freight. They just want to have a benchmark. I know the average freight must not be more than this, forgetting that if I’m bringing a shipment of 100 kilo, the freight I’ll be paying will be like two times below what I’ll be paying when I bring in about 10 tons because I can negotiate with the airline and they’ll give me a reasonable freight because of the volume I’m carrying; they same thing applies to a shipping company.
They don’t know but I deal with all of them. So, we must understand that anytime Customs increase revenue, it’s an indicator that the economy is nose-diving.
All over the world, where import revenue increases, all the citizens will be crying and they’ll be protesting but it’s an indication that there’s no more production. It’s an indication that there’s no more manufacturing. It’s an indication that they just turned into a dumping ground. And when you increase revenue, it’s an indication that the economy has nosedived.
And definitely, there can never be balance of trade. And there will never be balance of payment. I’ve never seen Customs talking about how to revamp exports.
I’ve never seen Customs talking about how to encourage exporters. Rather, they will put bottlenecks on exports and look for ways to encourage more imports. Nobody is talking about capital flights now.
But if you want to boost capital flights, this is the best time for you to do it. You just overload your invoice. And when you are doing your remittance, you can just get free money abroad.
Even if you are doing capital flight, Customs will even put you on a receiving award, World Customs Organisation Award, because you are generating more revenue for them. They will not look at what’s supposed to be the actual value of that consignment because they are half-faggot. Those days when we joined this job in the 80s and early 90s, if you are doing capital flight, Customs will be watching out for you.
For the National Assembly to have given the Customs target to increase the import revenue instead of increasing excise and internally generated revenue, it shows that whoever is superintending over such a committee does not have any knowledge of how an economy runs and what grows it.
And they are killing the economy further rather than revamping it. It’s the easiest way and the cheapest way to raise money in any environment, where people lack economic ideas. So, to me, an increase in import duty revenue is antithetical to economic growth.

 

 

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