Upon assumption of office six months ago, the Governor of Anambra State Prof. Charles Soludo, announced a new tax regime for the informal sector of Anambra State. The new tax regime essentially is an automation of the informal sector levies and taxes. For the transport sector, the tax regime required intra state transporters like keke and bus operators, to pay monthly operational levy, against the daily levies they used to pay.
Before now, in the previous administration, keke and bus operators make daily operational payment and they do not all pay the same amount. But the new tax regime required all keke operators to pay the sum of fifteen thousand Naira, Meanwhile bus operators are required to pay twenty five thousand Naira. For months, the argument has raged as to if it is appropriate for the government to require intra transporters to pay operational levy upfront, given that the levy is an operational charge; in other words, it is subscription to be able to operate. Many operators prefer daily payment of smaller amount, than monthly payment of bulky sum. The reason for this is not farfetched. There are also insinuations that the government’s new tax regime requires operators to pay more than they used to pay. Findings reveal that some keke operators in Awka pay N250 operational levy daily, before. While some pay N1, 500, others pay N500. Yet, there are some that do not pay at all. The operational levies seem to be based on clear economic realities that vary from route to route, such as passenger availability, amount paid by passenger per drop, among others.
Earlier, about a few months ago, transport operators had staged a protest against the new tax regime particularly the demand for them to pay monthly operational levy, saying that monthly payment is not in their best interest because it is doubtful that any public transport owner can operate for a full month without disruption. This disruption might be in the form of repairs on their keke or vehicle, or unavailability due to other demand on their time or some other important engagement. It is also noteworthy that some of the operators are skilled labourers who might be engaged in their other line of work for some days and therefore not be able to use their vehicle or keke for business within the time they are engaged. So far, the government of Anambra State under Prof. Soludo has remained resolute in its decision, despite concerns from the tax payers.
While this back and forth has continued for months, Anambra State Government has not been able to collect revenue from the informal sector since the government’s assumption of office in March this year. The Governor had stopped payment of levies and taxes by the informal sector, so that his government can be able to create a new system that is now in place, but yet to be accepted by the payers. Recently, the government had gone back to the tax contracting system in which some of the informal sectors are being concessioned to companies to manage on behalf of the state government, which was what the previous government did. This, perhaps, is given the enormity of challenges and difficult with automated tax payment for some, in the informal sector. The reality here though, is that some of the lofty aspirations of the new tax regime cannot be implemented for now. Some simply require gradual implementation.
The protest by keke and bus operators in Awka since yesterday which has affected movement around the city, also affected businesses, as many people waste productive time trekking round the city while others are unable to attend to their businesses. It is therefore something the government has to look into to find a balance. For more than half a year, while findings show that much of the levies are still being paid by transport operators, the government of Anambra State is the biggest loser as nothing has been remitted to its coffers from the informal sector, within the period. There are chances that as this disharmony continue to linger, the government stands more chance of getting nothing from the transport operators which is the major source of informal sector revenue to the government.
He is a Technical Assistant to Governor Willie Obiano’s Special Adviser on Legislative Matters, whoonce was a Special Adviser to a former Deputy Speaker of Anambra State House of Assembly. Ebuka is a second class upper division graduate of Political Science from University of Calabar, Calabar Nigeria and holds a Masters Degree in Political Science with specialization in Government and Development Studies, from Nnamdi Azikiwe University, Awka Nigeria
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