The Central Bank of Nigeria (CBN) Governor, Godwin Emefiele on Friday, at the 2016 Annual Bankers’ Dinner organized by the Chartered Institute of Bankers of Nigeria (CIBN), proposed a policy that is capable of solving the current economic crisis in Nigeria.
He highlighted these clearly as his opinion and not that of the central bank or bank’s Monetary Policy Committee. In his speech, he said that in order to raise additional revenue and get Nigeria’s economy back on track, the government should consider taxing every phone call above three (3) minutes.
According to him, if this policy is put in action, it could produce an additional N100 billion annually.
In his words:
“There are several ways we can raise additional revenue to finance the increased expenditure that is needed to engender fast and sustainable growth in the economy.”
“I think we can consider introducing a negligible telecom surcharge to be entirely borne by the initiator of a call. In order to protect the poor and vulnerable amongst us, we could structure it to only take effect after the third minute of talk.”
“Some analyses have indicated that the government could earn about N100 billion per annum from this alone. Obviously, this surcharge will mainly be borne by middle and upper class people since I do not know many poor people who make calls for more than 3 minutes!”
What then happens to the poor people who make late night calls or take advantage of packages that allow you to talk for longer?
“We could also consider introducing minimal property taxes across the country. This not only raises money for the government but also could be a veritable weapon against corruption since it creates a database of who really owns homes in this country.”
Bear in mind that this is not the first time a government official is proposing a communication tax (An example is the 9% communication tax bill). Let’s just hope this doesn’t become a reality.
He furthermore recommended reduction in importation. He gave examples of Taiwan and South Korea, as part of the fastest growing economies, due to its import-export policies. In his word, he stated:
“In view of the fact that oil prices would remain low for a long period, it is clear to us that FX revenue inflows will remain low, with relatively low FX Reserves, for a while.”
“Given this scenario, we need to take bold and decisive actions at fundamentally changing the structure of our economy. Of course, Monetary Policy alone cannot achieve this but it must do its part.”
“Throughout this speech, I have talked about the damaging effects of Nigeria’s unsustainable propensity to import. In line with Winston Churchill’s admonition to ‘never let a good crisis go to waste’, the CBN believes that it is high time we started looking inwards and stopped supporting the importation of items that we can produce locally using Nigeria’s hard-earned Foreign Exchange.”
He gave examples of Taiwan and South Korea, as part of the fastest growing economies, due to its import-export policies.