Seven years
ago Suzanne lost her husband in a motor accident, an unfortunate event which
left her a widow with seven children to raise; a task which she has committed
to achieve. “My kids are all I have”
says Suzanne. “I love them so much and
would sacrifice anything for them. They are the reason I continue to live and
struggle.”
Suzanne
Mbakwe hails from Ikeduru LGA of Imo State, and earns a living as a food vendor
in Kubwa market Abuja. Through her work, she has managed to raise savings from
which she built an apartment for her family and ensures her children always
have food to eat. The one thing she has not been able to provide for them,
however, is an education. Having no extended family to help her, her little
income is not sufficient to pay school fees. She is saddened that she cannot
help her children, but is frustrated with the government. As she says, “government should build schools and provide
free education for children, so that people like me can be able to send my
children to school.”…
In that
regard, Suzanne is correct; access to basic quality education is a human right
and the Nigerian government has committed to providing it. Yet currently there
are over 10 million Nigerian children out of school- the highest number in any
country in the world. Those who are in school suffer from poor quality teaching
and learning environments. This statistic is particularly shocking when the
promising economic growth of the country is put in perspective. Statistics show
that in the last decade, the Nigerian economy has grown by 89%, as a result,
the country now boast of having the largest economy in Africa. Yet,
paradoxically, this has not led to development of needed infrastructure and
wealth creating amenities. Hence poverty
and denial of access still plague the average Nigerian.
Regimes after
regimes of Nigerian governments have serially failed to provide basic
infrastructure and wealth creating amenities as they struggle with finding a
sustainable source of funds to finance development projects vis-à-vis the
deeply rooted corruption in the country. Lack of steady funds for development
projects is not just peculiar to Nigeria alone; it has proven to be the bane of
development in most developing countries of the world.
Tellingly, when
the development challenges of these countries are juxtaposed to the number of
foreign investments in these countries, the question “where does all the revenue gotten from foreign investments go?”
becomes obvious. Sadly, research shows that Africa and most developing
countries despite being the hub of foreign investments lose a lot of money illicitly
through tax dodging by multinational companies and granting of tax exemptions or
tax holiday by the government of these countries. According to a report from
Global Financial Integrity (GFI), an estimated figure of about $854 billion was lost from Africa through Illicit
Financial Flows (IFFs) within the last two decades, of which trade
manipulations by multinational companies contributed the most. These monies
could have been used to fund and sustain development in these countries and as
a result, reduce the cost of living in these regions. To worsen the situation,
the misguided offer of tax incentives or tax waivers to multinational companies
by the government as a lure to attract investment into the continent means that
these companies take advantage of the best of the few available infrastructure,
make massive profits on them, deny the common man and indigenous firms of
access to them in the process, but conveniently avoid paying proportional taxes
on the profits they make. Thus there is a thriving market for foreign
investments in the region without the consequent capital benefits that should
follow such investments.
Upon hearing
of how foreign companies enjoy harmful tax benefits, while the common man like her
paid tax, Suzanne said: “Any foreign company
that does not want to pay tax, they should close the company because they are
gaining from Nigeria but don’t want Nigeria to gain from them”. She then
sums up the unfairness of the situation in one simple question- “we are paying tax in Kubwa market,
therefore they will have to pay, is it not the same Nigeria?”
In
retrospect, if foreign companies paid tax, and the tax money is duly reinvested
to fund development as it should be, then the government wouldn’t have had to
revert to regressive taxation to bridge the gap of lack of funds for
development. Consequently, there
wouldn’t have been increased tax on everyday commodity, social injustice due to
unfair taxation, and high cost of living in these areas. In other words, “the
common man” like Suzanne would spend less on sustaining her family and be able to
afford school fees for her children.
Until the Nigerian
government stops granting tax exemptions to multinational companies, block all
loopholes in the tax regulatory framework that allow these companies to dodge
tax paying, and establish an international regulatory coordination with other
African governments and governments of similarly affected countries, as well as
governments of developed countries to stamp out tax dodging by multinationals from
the continent and beyond, the common man like Suzanne will continue to bear the
brunt, and the economy of the country would deceptively continue to grow while
development of infrastructure and wealth creating amenities continue to
shrivel- a situation akin to thirst in an ocean of water.
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