Rangers of Enugu v Heartland of Owerri, see attendance, negligible Why? Everyone was at home to watch Sunderland take on Arsenal on DSTV
By sheer numbers alone, our football should be the most lucrative in Africa, we have the fans in every city to fill a 10,000 capacity ground, but where are the fans? Where are the sponsors? Better still where are the Nigerian investors? DSTV is investing in Nigerian football, a South African company, they are also sponsoring the Nigerian Basketball League.
What about Nigerian music? Today Nigerian music, the hip hop brand is the best in Africa, economically that is, we have even won the Grammy Twice! these chaps were made, produced and blended in Agegunle and Jos. However It took DSTV, South Africans vis Channel O to make Nigerian music hip!
What about movies, Nollywood is a $500m industry, Nollywood is the highest employer after the Federal Government, Where are the Nigerian institutional investors? How many Nigerian banks have a Nollywood desk?
see how Economist describes the power of Nollywood.
"Nigerian films are as popular abroad as they are at home. Ivorian rebels in the bush stop fighting when a shipment of DVDs arrives from Lagos. Zambian mothers say their children talk with accents learnt from Nigerian television. When the president of Sierra Leone asked Genevieve Nnaji, a Lagosian screen goddess, to join him on the campaign trail he attracted record crowds at rallies. Millions of Africans watch Nigerian films every day, many more than see American fare"
This is power, latent power, has Nigeria tapped this power? This is far beyond some patriotric write up, this episode in Nigeria economic history will probably go down as the biggest missed opportunity by Nigerian businesses and the government.
the Pentagon has an agreement with Hollywood, Hollywood gets all the military gear it needs for it's films, but has to portray the Military and America in good light, the "bad movies" like Platoon which show GI's abusing Vietnamese girls don't get Pentagon support. Hollywood is America biggest export, it's Hollywood that sells IPods not Apple, it's Hollywood that sells American cars, not Detroit, Hollywood sells Jeans, not Levis. simplly put Hollywood is Americans marketing department.
Everybody in this planet admires America, even the Iranians and the North Koreans why? What they see ND believe on hollywood. At a point, America was beaming the Cosby Show with the Huxtables into communist Cuba to show the comrades what they were missing.
So why can't the Nigerian government use Nollywood and our hip hop music to sell Nigerian goods? Why can't the Northern textile mills get DBanji and Asa to promote "Nigerian textiles" just as the US milk industry uses hollywood stars to promote the consumption of Milk? That surly will spark a demand for the Nigerian cotton abi?
I read that 1m jobs were lost by the leather industries in Kano, Why cant Aba and Kano together ask Nollywood to promote made in Nigerian shoes, if the same Genevive says in Zambia that she wears only genuine Kano leather slippers or Made in Aba pumps, do we not think Malawians will demand those same Kano leater slippers? Even for security, Why can't the SSS sponsor a local hausa film to explain why Boko Haram will only lead to job losses and disinvestment in the North?
For our football, why cant the FGN guarantee loans to football clubs or even ask the NDE to buy bonds issued by these football clubs? The value chain for football involves the publicity, the sportswear, the betting, the broadcasters, accountants, agents, sports medicine, hospitality etc, these are all jobs long hanging fruits, have we tapped it? If DSTV can show Nigerian football, why can't NTA?
I commend Lagos state for using Nollywood to sell the paying of taxes, the result are very positive.
You can't "buy" a Nollywood, It's a godsend, and the Nigerian Govt must use it. If the banks won't loan money to Nollywood, then simply allocate money to them, because they are job creators, heck we allocate money for other consumption stuff like paying religious pilgrimage estacode.
We need to use Nollywood, we need to maximize our hip hop music and our football to create jobs, and drive Nigerian exports, if we don't, DSTV will rebranded Nollwood as DSTV Magic and that goodwill will go to Jbourg.
It's our problem and we can fix it
Monday, February 20, 2012
Saturday, July 2, 2011
fix the fiscal federalism
Fix the Fiscal Federation
Executive Summary
The Federal government has abrogated to itself massive power over virtually every economic activity in Nigeria. This makes the states and Local Governments useless and makes the cost of running the federal government obscene. A key figure to take away is that the FGN spends 63% on its workers to provide these services to the Nigerian people.
The proposal is for the President to present a Bill to reduce the powers, specifically the fiscal powers of the Federal Government by devolving tax powers to states and Local governments.
What is the problem with Nigeria fiscal structure?
1. The Federal Government legislates and collects all fiscal revenue.
Nigeria is a federal republic In Nigeria, the fiscal power should be based on a three-tiered structure of federal, state and local governments but this is not so. The Nigerian tax system favours the federal government, as pointed out by the Study Group on Tax Reform (2003), the federal government accounts for 99% of the tax revenue in Nigeria.
All fiscal enactment powers are held by the Federal Government e.g. Personal income tax (PIT) is legislated by the federal government, payable by individuals, but collected by state authorities. For concurrent taxation such as the capital gains tax and stamp duties, the federal government retains legislative power, while sharing administrative powers with the states. The federal government has jurisdiction for such taxes as VAT and Education tax. The federal government taxes corporate bodies while state and local governments tax individuals.
The state and local governments have had no freedom to introduce new taxes because matters dealing with taxation are on the Exclusive list of the constitution. They may enact laws only with the concurrence and approval of the National Assembly
Why is this problem?
1. It deprives the states and Local governments the ability to use taxation as a means of earning revenue or attracting investment.
States like Lagos earn almost 80% of their income from the PIT, but they cannot determine the rate to apply to attract investment. The Company Income Tax CIT and the VAT are collected in states. Lagos State may build roads and attract multinationals to Lekki but the federal government will take the revenues generated by these multinationals.
It also put all the states in the same bracket in terms of tax policy. Ogun state for instance cannot use a lower VAT or CIT rate as an incentive to attract investors from Lagos to Ogun. Yobe state cannot declare a tax free zone to attract Dangote Industries to set up a factory there.
States like Lagos also see no incentive to enforce the payment of taxes as these taxes are sent to the centre. The CBN estimates that Lagos has about 60% of the manufacturing and commercial activity in Nigeria. Lagos is the generator of the highest VAT and the highest Customs duty, but it does not see these tax benefits. It is, instead, shared anchored on such factors as equality of states (40 per cent), population (30 per cent), landmass and terrain (10 per cent), social development needs (10 per cent), and internal revenue efforts (10 per cent). This sharing formula, discouraging revenue drive, particularly for federally adjudicated taxes e.g. VAT.
2. The federal government is reckless with spending.
The tax (and revenue) collected is used to pay federal workers.
Take the figures for 2010, the total receipts for Companies Income Tax, VAT and Customs duty was N1.40t (net of cost of collection, gross collection was N1.52t). Let us now look at the total non-debt cost of the federal government (salaries, pensions) that is N2.54t.
In effect, the total tax revenues of the nation are swallowed up by personal cost of the federal government. An argument can be made that oil revenues are actually paying the salaries of the federal workers but keep in mind that non-oil revenues made up 34% of the total revenue in 2010.
In addition, how many federal workers do we have in Nigeria? The federal workers take home 63% of the total revenues of the nation, (tax and oil receipts).
3. It makes Local governments ineffective.
The current fiscal structure created a situation where the Local governments must exist at the mercy of the federal and state government.
Primary schooling is the exclusive responsibility of local governments; the constitution states, “The functions of a local government council shall include the provision and maintenance of primary, adult and vocational education”. We then wonder how Nigerian children can be educated by taxes charged on items such as fees on marriages, motor parks and bicycles.
Unlike States who can charge Personal Income Taxes generate billions of Naira (like Lagos), the Local governments have been “allocated” very poor means of livelihood and are thus unable to serve the citizens of the LGA.
What can GEJ do about it?
• Amend the constitution to allocate to the three theirs of the federation appropriate income-generating taxes to enable them fulfil their constitutional requirements. The federal government cannot simply tax the wealth of Nigeria and spend it on only the federal workers. Such a move will discourage the payment of taxes.
• Devolve most of the powers from the exclusive list to the concurrent and the forth schedule or and duties of the Local governments e.g. Insurance, stamp duties as a whole, and VAT.
• The states and Local governments should share VAT
• States to determine and charge Personal Income Tax
• Local Governments to charge Property taxes, charge, and collect the education taxes
• Pass a law that will cap how much of the federal, state or Local Government earnings can be allocated to recurrent expenditures. This is specifically to forestall a situation where taxes are charged just to maintain the lifestyle of workers.
It’s important to note that The former president of the NBA has presented a private bill to the National Assembly for an Act to alter the Constitution of the Federal Republic of Nigeria 1999 by creation of the States Court of Appeal, introduction of Federal and State Legislative Lists and adjustments/modifications of legislative powers of government between the Federal and State Governments."
Agbakoba said the present "bloated federal system" had made governance too expensive to support any meaningful development in the country.
The bill seeks to replace the "Exclusive Legislative List" with "Federal Legislative List" with respect to powers limited to the federal government and introduced the "State Legislative List" for powers exclusive to the state governments.
Issues recommended in the bill for devolution to the states include natural and mineral resources, excluding petroleum and gas; agriculture; micro finance banks; municipal police, state appeal courts; solemnisation of marriages; incorporation of business enterprises with state objects; taxes on income and profits within states, other than income and profits of companies; regulation of labour and industrial relations at the state level, including prescription of minimum wage; and evidence.
It is our problem and we will fix it.
Executive Summary
The Federal government has abrogated to itself massive power over virtually every economic activity in Nigeria. This makes the states and Local Governments useless and makes the cost of running the federal government obscene. A key figure to take away is that the FGN spends 63% on its workers to provide these services to the Nigerian people.
The proposal is for the President to present a Bill to reduce the powers, specifically the fiscal powers of the Federal Government by devolving tax powers to states and Local governments.
What is the problem with Nigeria fiscal structure?
1. The Federal Government legislates and collects all fiscal revenue.
Nigeria is a federal republic In Nigeria, the fiscal power should be based on a three-tiered structure of federal, state and local governments but this is not so. The Nigerian tax system favours the federal government, as pointed out by the Study Group on Tax Reform (2003), the federal government accounts for 99% of the tax revenue in Nigeria.
All fiscal enactment powers are held by the Federal Government e.g. Personal income tax (PIT) is legislated by the federal government, payable by individuals, but collected by state authorities. For concurrent taxation such as the capital gains tax and stamp duties, the federal government retains legislative power, while sharing administrative powers with the states. The federal government has jurisdiction for such taxes as VAT and Education tax. The federal government taxes corporate bodies while state and local governments tax individuals.
The state and local governments have had no freedom to introduce new taxes because matters dealing with taxation are on the Exclusive list of the constitution. They may enact laws only with the concurrence and approval of the National Assembly
Why is this problem?
1. It deprives the states and Local governments the ability to use taxation as a means of earning revenue or attracting investment.
States like Lagos earn almost 80% of their income from the PIT, but they cannot determine the rate to apply to attract investment. The Company Income Tax CIT and the VAT are collected in states. Lagos State may build roads and attract multinationals to Lekki but the federal government will take the revenues generated by these multinationals.
It also put all the states in the same bracket in terms of tax policy. Ogun state for instance cannot use a lower VAT or CIT rate as an incentive to attract investors from Lagos to Ogun. Yobe state cannot declare a tax free zone to attract Dangote Industries to set up a factory there.
States like Lagos also see no incentive to enforce the payment of taxes as these taxes are sent to the centre. The CBN estimates that Lagos has about 60% of the manufacturing and commercial activity in Nigeria. Lagos is the generator of the highest VAT and the highest Customs duty, but it does not see these tax benefits. It is, instead, shared anchored on such factors as equality of states (40 per cent), population (30 per cent), landmass and terrain (10 per cent), social development needs (10 per cent), and internal revenue efforts (10 per cent). This sharing formula, discouraging revenue drive, particularly for federally adjudicated taxes e.g. VAT.
2. The federal government is reckless with spending.
The tax (and revenue) collected is used to pay federal workers.
Take the figures for 2010, the total receipts for Companies Income Tax, VAT and Customs duty was N1.40t (net of cost of collection, gross collection was N1.52t). Let us now look at the total non-debt cost of the federal government (salaries, pensions) that is N2.54t.
In effect, the total tax revenues of the nation are swallowed up by personal cost of the federal government. An argument can be made that oil revenues are actually paying the salaries of the federal workers but keep in mind that non-oil revenues made up 34% of the total revenue in 2010.
In addition, how many federal workers do we have in Nigeria? The federal workers take home 63% of the total revenues of the nation, (tax and oil receipts).
3. It makes Local governments ineffective.
The current fiscal structure created a situation where the Local governments must exist at the mercy of the federal and state government.
Primary schooling is the exclusive responsibility of local governments; the constitution states, “The functions of a local government council shall include the provision and maintenance of primary, adult and vocational education”. We then wonder how Nigerian children can be educated by taxes charged on items such as fees on marriages, motor parks and bicycles.
Unlike States who can charge Personal Income Taxes generate billions of Naira (like Lagos), the Local governments have been “allocated” very poor means of livelihood and are thus unable to serve the citizens of the LGA.
What can GEJ do about it?
• Amend the constitution to allocate to the three theirs of the federation appropriate income-generating taxes to enable them fulfil their constitutional requirements. The federal government cannot simply tax the wealth of Nigeria and spend it on only the federal workers. Such a move will discourage the payment of taxes.
• Devolve most of the powers from the exclusive list to the concurrent and the forth schedule or and duties of the Local governments e.g. Insurance, stamp duties as a whole, and VAT.
• The states and Local governments should share VAT
• States to determine and charge Personal Income Tax
• Local Governments to charge Property taxes, charge, and collect the education taxes
• Pass a law that will cap how much of the federal, state or Local Government earnings can be allocated to recurrent expenditures. This is specifically to forestall a situation where taxes are charged just to maintain the lifestyle of workers.
It’s important to note that The former president of the NBA has presented a private bill to the National Assembly for an Act to alter the Constitution of the Federal Republic of Nigeria 1999 by creation of the States Court of Appeal, introduction of Federal and State Legislative Lists and adjustments/modifications of legislative powers of government between the Federal and State Governments."
Agbakoba said the present "bloated federal system" had made governance too expensive to support any meaningful development in the country.
The bill seeks to replace the "Exclusive Legislative List" with "Federal Legislative List" with respect to powers limited to the federal government and introduced the "State Legislative List" for powers exclusive to the state governments.
Issues recommended in the bill for devolution to the states include natural and mineral resources, excluding petroleum and gas; agriculture; micro finance banks; municipal police, state appeal courts; solemnisation of marriages; incorporation of business enterprises with state objects; taxes on income and profits within states, other than income and profits of companies; regulation of labour and industrial relations at the state level, including prescription of minimum wage; and evidence.
It is our problem and we will fix it.
Saturday, June 11, 2011
repeal the Land Use Act
An Act to Vest all Land compromised in the territory of each State (except land vested in the Federal government or its agencies) solely in the Governor of the State , who would hold such Land in trust for the people and would henceforth be responsible for allocation of land in all urban areas to individuals resident in the State and to organisations for residential, agriculture, commercial and other purposes while similar powers will with respect to non urban areas are conferred on Local Governments.(27th March 1978) Commencement.
1. Repeal the land Use Act.
In simple terms, the Land Use Act places a government official between a legal contract of ownership and sale of land. It places all land in the hands of government and specifies that future transfers or sale of land must be authorised by a government official irrespective of the value of the transaction. "It shall not be lawful for any customary right of occupancy or any part thereof to be alienated by assignment, mortgage, transfer of possession, sublease or otherwise howsoever -
(a) Without the consent of the Governor in cases where the property is to be sold by or under the order of any court under the provisions of the applicable Sheriffs and Civil Process Law; or
(b) in other cases without the approval of the appropriate Local Government."
Land Use Act
The main issues of the Land Use Act of 1978 is that it transfers title and ownership of land from individuals and communities to the Governors of the states who hold the land in trust. It also makes acquisition of land by individuals and corporate bodies for commercial, agricultural and economic development purposes extremely difficult.
This leads to transaction bottlenecks, cumbersome and tiresome processing of title documents and negative wealth as all land without a C of O cannot be brought into any formal transaction. Consider that if a client wanted to buy or sell a Rolls Royce or an oil Refinery, the transaction would involve both parties' legal teams, but crucially it would not need the consent or accent of any government official before the sale is approved.
Another contentions issues is the changing of the legal status of the Nigerian land "user" from ownership to that of statutory occupancy. In effect no Nigeria owns any land, we simply have a statutory right to use it, this limits the rights of the "user" i.e. your proprietary interests are extinguished.
The argument against repel will rest with the issues government has in securing land from private citizens for the greater public good e.g., building a road over private land. These concerns can be address by passing a bill to give the Federal and State Government the power to acquire land under the Right of Eminent Domain, i.e. the superior dominion of the sovereign over individual property rights. The Land Use is in fact a universal application of this Eminent Domain right.
The repeal of the Land Use Act will immediately give millions of Nigerians "equity". They can own, transfer and/or sell the land they live on, put up that land as collateral, bring the land into the formal market place and make property transactions easier to finance via financial institutions.
The Repeal will boost Nigeria mortgage market, it will create jobs as realtors, surveyors, estate agents, and builders will have more opportunities and more property to bring into the market.
Most importantly, the repel of the Act will open agricultural land otherwise "locked" up in administrative red tape in the Local Governments. Farmers can negotiate directly with the local community for sale or lease of hectares of arable land to grow food, considering that 70% of Nigerians labour is agricultural based, the bottle neck of ownership of land if removed will instantly increase the acreage of land available to agriculture.
Its important to note that that Late President Umaru Musa Yar'Adua had sent 14 Amendment clauses (titled Land Use Act (Amendment) Act 2009 or the Constitution (First Amendment) Act 2009) to the National Assembly for the purpose of amendment.
So i would like the president to push the 7th congress to consider and pass these 14 amendment clauses or simply sponsor a new bill to repel the Land use Act.
Without land, there is no wealth.
Its our Problem, we will fix it.
1. Repeal the land Use Act.
In simple terms, the Land Use Act places a government official between a legal contract of ownership and sale of land. It places all land in the hands of government and specifies that future transfers or sale of land must be authorised by a government official irrespective of the value of the transaction. "It shall not be lawful for any customary right of occupancy or any part thereof to be alienated by assignment, mortgage, transfer of possession, sublease or otherwise howsoever -
(a) Without the consent of the Governor in cases where the property is to be sold by or under the order of any court under the provisions of the applicable Sheriffs and Civil Process Law; or
(b) in other cases without the approval of the appropriate Local Government."
Land Use Act
The main issues of the Land Use Act of 1978 is that it transfers title and ownership of land from individuals and communities to the Governors of the states who hold the land in trust. It also makes acquisition of land by individuals and corporate bodies for commercial, agricultural and economic development purposes extremely difficult.
This leads to transaction bottlenecks, cumbersome and tiresome processing of title documents and negative wealth as all land without a C of O cannot be brought into any formal transaction. Consider that if a client wanted to buy or sell a Rolls Royce or an oil Refinery, the transaction would involve both parties' legal teams, but crucially it would not need the consent or accent of any government official before the sale is approved.
Another contentions issues is the changing of the legal status of the Nigerian land "user" from ownership to that of statutory occupancy. In effect no Nigeria owns any land, we simply have a statutory right to use it, this limits the rights of the "user" i.e. your proprietary interests are extinguished.
The argument against repel will rest with the issues government has in securing land from private citizens for the greater public good e.g., building a road over private land. These concerns can be address by passing a bill to give the Federal and State Government the power to acquire land under the Right of Eminent Domain, i.e. the superior dominion of the sovereign over individual property rights. The Land Use is in fact a universal application of this Eminent Domain right.
The repeal of the Land Use Act will immediately give millions of Nigerians "equity". They can own, transfer and/or sell the land they live on, put up that land as collateral, bring the land into the formal market place and make property transactions easier to finance via financial institutions.
The Repeal will boost Nigeria mortgage market, it will create jobs as realtors, surveyors, estate agents, and builders will have more opportunities and more property to bring into the market.
Most importantly, the repel of the Act will open agricultural land otherwise "locked" up in administrative red tape in the Local Governments. Farmers can negotiate directly with the local community for sale or lease of hectares of arable land to grow food, considering that 70% of Nigerians labour is agricultural based, the bottle neck of ownership of land if removed will instantly increase the acreage of land available to agriculture.
Its important to note that that Late President Umaru Musa Yar'Adua had sent 14 Amendment clauses (titled Land Use Act (Amendment) Act 2009 or the Constitution (First Amendment) Act 2009) to the National Assembly for the purpose of amendment.
So i would like the president to push the 7th congress to consider and pass these 14 amendment clauses or simply sponsor a new bill to repel the Land use Act.
Without land, there is no wealth.
Its our Problem, we will fix it.
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