The Minister of Finance and Coordinating Minister of the Economy, Wale Edun, said yesterday that the Federal Government would pin down ways and means to deal with the problem of too much liquidity in the system.
Fielding questions from journalists after a meeting with investors at the on-going spring meetings of the IMF and World Bank in Washington DC, yesterday, he said that the fiscal and monetary authorities were complementing each other to bring down inflation.
“We will pin down Ways and Means to alleviate the pressure of the excess money in the system.
“By so doing the two authorities are working hand in hand to bring down inflation and pressure on price stability and stabilising the exchange rate, with the target of bringing down interest rate so that investors can borrow at a more affordable rate and getting the economy going in the right direction again.
“We need to borrow less and focus more on domestic resource mobilisation. We want long-term resources to avoid repayment and refinancing pressures”, Edun said.
The minister added that the nation’s tax/GDP was too low, even lower than the African region average and that as such, reforms were underway to streamline the number of taxes, deploy technology and implement policies that would double tax revenue in the next three years
His words: “At 10 per cent to GDP, what should I say, it would appear as if some people are not paying their taxes.
“Our strategy is to increase the tax revenue without increasing the rate of taxes. We want to deploy technology to make tax collection more efficient.
“Our analysis has shown that 90 per cent of tax revenue comes from nine tax heads while we have over 80 taxes from federal, through states to local councils.
“Mr. President eleven if we eliminate the large number of these taxes and concentrate on the nine that yield the current 90 per cent revenue and deploy technology, there will be more efficiency and we will be able to double our tax revenue in about three years.
“If we eliminate the large number of taxes and bill people properly we will gain in terms of the peoples’ willingness to pay and you will collect more revenue.”
Addressing a question on food security, the minister said that the administration was dealing with the problem of providing access for farmers to their farms, especially in parts of the country where insecurity had played a major role in reducing food production.
“What the security says now is that the insecurity now is more of economic than doctrinal reasons”, the minister said.
Edun added that agro clusters were being developed in collaboration with the African Development Bank to increase food production in the country.
