Stakeholders including chief executives of companies have pointed out some critical areas of the economy that are missing in the 2017 national budget.
Specifically, they said asset sales which include the refineries, depots, product pipelines and gas pipelines among others are not seen in the budget.
Austin Avuru, chief executive officer, Seplat Nigeria plc who spoke at the tax breakfast meeting organised by KPMG in Lagos, urged the Federal Government to minimise spending on oil and gas, deregulate the downstream and sell non-performing assets.
He was concerned that liquidity crisis is shutting out the private capital while the government is throwing money at a problem that is structural.
Corroborating with Avuru, Wole Obayomi, partner and head, tax, regulatory and people services, KPMG, Nigeria, said the budget is scanty on tax, adding that there is no policy or strategy to accomplishing it.
Looking at the budget, he wondered where the 22 percent surge in Federal Government share of value added tax is going to come from. Obayomi said late presentation and passage of budget would bring the economy backward.
“Time has come for us to use annual budgets as instruments of fiscal reform to achieve the revenue objectives of the Government.Timely presentation of the Budget by the Government to the National Assembly (NASS), and speedy passage of the Budget by the NASS cannot be over-emphasized”, Obayomi said.
In her presentation, Yemi Owolabi, executive director finance, Standard Chartered Bank, said alignment between fiscal and monetary policy is required to deliver structural reforms. She admitted that is need for a trade-off between exchange rate, domestic interest rates and inflation, stressing the urgent need to address cost and ease of doing business to support real sector growth and stimulate trade/Investments.
Owolabi said economic activities would collapse in the absence of a vibrant banking sector, adding that Stronger public institutions to support efforts of the banking Industry is required.
On the area of capital market, she said deepening of the markets to attract foreign investment into the country, as well as broadening of investors’ understanding of capital market products is necessary. She also stress the need for Improved corporate governance to stimulate savings / investment culture to generate longer term capital.
KPMG also launched the maiden edition of our annual Nigerian Tax Journal, which covers: Tax outlook for 2017, compilation of significant tax cases decided in 2016 and select articles by KPMG subject-matter experts.
