He said it will amount to taxing ordinary men in the country.
Tinubu, who spoke on Thursday at the 11th Bola Tinubu Colloquium to mark his 67th birthday in Abuja, said the government should widen the tax net and ensure all those Nigerians who have refused to pay their tax are made to do so as a way of raising revenue.
He said increasing VAT was tantamount to reducing the purchasing power of the people.
“I must say this to Prof Osinbajo and his team, don’t increase VAT but increase tax net to accommodate those who are not yet paying,” he said.
“Don’t reduce the people’s purchasing power.”
Speaking further, Tinubu said: “We must criticise ourselves.”
There are some contradictions here. He's asking govt not to reduce purchasing power at the same he's suggesting that govt should only tax net income so as to accommodate those that are yet to be paying tax. In the long run, the downtrodden are still going to hear the burden
— Mr. Cole (@colebizle) March 28, 2019
Meanwhile, The Manufacturers Association of Nigeria (MAN) has also asked the Federal Government to tread with caution in the drive for improved revenue.
The Director-General of MAN, Mr Segun Ajayi-Kadirwho said this in a statement on Wednesday said such policy was not ‘manufacturing friendly’, adding that implementing it would have a negative effect as a result of the planned increase in minimum wage.
“As plausible as the recommendation to increase VAT may look, implementing it at this time would boomerang because the timing is inappropriate, especially at a time when the minimum wage of N30,000 was just agreed upon,” he stated.
The MAN DG added, “This could send a wrong signal that the government is not sensitive to the plight of the low- and middle-income earners, who are clearly in the majority. The Nigerian economy will be in a more vulnerable state if VAT is increased.
“No controversy, the burden of the tax would be shifted to the Nigerian consumers that are already struggling, the economy would certainly experience demand crunch, inventory of unsold items would soar, profitability of manufacturing concerns would be negatively impacted, many factories will witness serious downturn or wind down operations.”
Nigeria for the first time is experiencing an honest leadership. Honesty is an important element on governance and that is what this present leadership embodies ~ Yemi Osinbajo #BTC11 #BTCNextlevel #BTCColloquium pic.twitter.com/aRLPsVf2j6
— CBN Gov Akinsola Ak (@cbngov_akin1) March 28, 2019
Ajayi-Kadiri, therefore, advised the government to widen the tax net rather than increase the rate in order to meet the growing need for more revenue to address the development objective of the country. He also appealed to the government not to increase the VAT at this time but consider the implementation of the afore-mentioned tax specific recommendations.
The MAN DG asked the government to continue to ramp-up support for the manufacturing sector in the best interest of the people.