A tax expert, Mr Anthony
Azubuike, has advised tax administrators to evolve new strategies to improve efficiency in tax administration.
He specifically charged tax administrators to adopt strategic framework to enable them establish the exact incomes of operators in the informal sector.
Azubuike, chief executive officer of Greeneracres & Consults, a Warri-based tax consulting firm, gave the advice in an interview with newsmen in Warri.
He said that ascertaining the true financial status of taxpayers in the informal sector would guard against poor tax assessment and “the judgmental approach” currently adopted by tax administrators.
Azubuike said that this development was unhealthy to the growth of the country’s tax system.
He also said that the situation would persist unless steps were taken by relevant tax authorities to address the anomalies.
“There is need for tax administrators to develop better framework that will adequately determine the true earnings of those in the informal sector.
“Until we are able to develop reliable means of measuring their income and know what they are liable to pay as income tax, we may end up using the judgmental analysis.
“For instance, if welders are given across-the -board tax assessment of N3, 000, while some would groan under that condition, others would smile because they are not generating proportional income.
“In other words, those who are making more money may find the N3, 000 very small to pay as tax, while those making less income may find the money as very big.
“So, the across-board assessment in the informal sector is a big challenge, especially in the Nigerian context,’’ he said.
