The recently proposed annual renewal of evidence of ownership for cars should not be put into effect, according to the Fiscal Policy Partner and Africa Tax Leader at PwC, Mr. Taiwo Oyedele.
Oyedele responded to the policy via a tweet, calling the renewal’s introduction retrograde, stupid, and badly thought out because it would establish a poor precedent for additional regressive taxation.
He claimed that, aside from the payment, which appears to be made primarily for income creation and more for non-state actors than for the government, it is absurd that people must demonstrate their ownership of a car on an annual basis even though they already have a certificate of evidence of ownership issued by the government.
He claimed that this makes doing business challenging and lowers tax morale. He also added that it is inconsiderate of the government especially now that Nigerians are still feeling the effects of the elimination of fuel subsidies.
The NBS estimates that there are around 12 million vehicles in Nigeria, according to Oyedele.
“The tax will produce annual gross receipts of N12 billion if everyone pays and complies, even after accounting for the unquantifiable time, expense, and burden of compliance by vehicle owners as well as the expected high cost of collection and potential leakages.”
He noted that the government shouldn’t impose any new or increased taxes on energy, food, or transportation, which are the sectors most affected by the removal of subsidies, in order to show compassion and tact.
“To maintain order and avoid creating a negative precedent, the tax should be suspended. If this is successful, who says we can’t be required to renew our birth certificates, C of Os, etc. annually as well?” he said.
On Tuesday, June 27, the Lagos State Government stated that starting on July 1, 2023, the annual renewal of the Proof of Ownership Certificate for automobiles registered in the state would begin.
This was in line with the Federal Government Joint Tax Board’s statement following an emergency meeting on May 9, 2023.
The permanent secretary of the Lagos State Ministry of Transportation, Abdul-Hafiz Toriola, emphasized that the renewal process will ensure national data integration and that the government is committed to maintaining accurate and current records of vehicle ownership, which are essential for efficient traffic management, law enforcement, and public safety.
He claimed that a minimal price of One Thousand Naira Only would be charged to issue the paperwork at the time of renewing vehicle information.
