I read the news of Governor Godwin Obaseki’s tax credit to Saro Group – the same firm the Governor entrusted the Sobe farm agriprenuer project. I mean the failed project without nothing to account for.
Sincerely, I see this latest scheme as an avenue to fleece the state of It’s lean resources and seems to me that someone has an interest in this company.
More than anything else, the very idea of tax credit is suspicious under any circumstances, let alone under this opaque government – or else, what are the terms of this tax-credit?
Worst still, there’s no known law of the state government that permits it. Rather, Obaseki claimed he’s resorting to executive order (Executive Order No. 1) to put this in place.
The immediate and direct effect of tax incentives is the loss of potential government revenues.
Particularly in this part of the world, tax incentives undermine government efforts to raise adequate domestic resources to finance the delivery of essential services and social protection at the scale and quality necessary to ensure that their citizens are able to fulfil unrealised rights, address inequality and meet the Sustainable Development Goals for all.
Widespread use of tax incentives may also be linked to problems of poor governance and corruption.
There’s a perceived link between the use of tax incentives to illicit financial flows and the impact on human rights.
While tax incentives may not be illegal, many of them create complex tax structures that provide greater opportunities for tax abuse.
There is no conclusive evidence that tax incentives are linked to any positive economic or social impact, especially in this part of the world.
John Mayaki