Stella Dimoko Korkus.com: Tinubu Tells Buhari To Reduce Tax And Suspend VAT

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Sunday, March 29, 2020

Tinubu Tells Buhari To Reduce Tax And Suspend VAT

The was contained in the former Lagos State Governor’s 13-page message he sent to Nigerians to mark his birthday.





The National Leader of the All Progressives Congress, APC, Bola Ahmed Tinubu, has shared what he described as a few preliminary thoughts on the economic action the President Muhammadu Buhari administration might take should the coronavirus mortally threaten Nigeria’s economy.


The was contained in the former Lagos State Governor’s 13-page message he sent to Nigerians to mark his birthday.

Tinubu said that this point, the Government should announce a tax credit or partial tax reduction for companies or firms and suspend VAT for the next 2-4 months, adding that “This will help lower import costs and protect against shortages.”


He advised the government to maintain its expenditures, adding that the natural instinct will be to reduce spending.

The APC leader said that such reductions may be prudent for individuals and households, but maintained that for government to move in this direction only feeds economic carnage by amplifying economic hardship.

“Prudent fiscal policy is generally ‘countercyclical.’ As the private sector shrinks, government does more,” he added.


“At minimum, the federal government must stick to its naira budgetary expenditures. In fact, government should increase naira expenditures by at least 10 – 15 percent during an emergency.

“Allocations to state and local governments should be included in this addition. If not, we risk subnational recessions in important sections of the country.”

He further advised that if the virus is largely kept from becoming a widespread public health menace, “government should accelerate spending and actual work on key infrastructural projects particularly regarding transportation. This will lower costs while bolstering the economy by generating employment and business activity.


“If the virus does become a large-scale public health challenge, more funds should be allocated to the health sector.”

Tinubu said, “TAX REDUCTIONS: Government should announce a tax credit or partial tax reduction for companies or firms. VAT should be suspended for the next 2-4 months. This will help lower import costs and protect against shortages.

“FOOD SECURITY: We need to protect the people from food shortages and high prices. As such, we must quickly improve farm-to-market delivery of agricultural produce. Also, government should initiate a crash program to decrease spoilage of agricultural produce by construction of storage facilities in local marketplaces in and around major cities and towns throughout the country.

“We must establish a strategic grain reserve. Government should help ensure supply by establishing minimum premium price for certain food products.

“LOWER INTEREST RATES: CBN should lower interest rates to spur borrowing and private sector activity.

“QUANTATIVE EASING: CBN and other financial regulators should be alert to signs of fragility in the financial markets and banking sector.

“The Central Bank should be prepared to enact extraordinary measures should the financial sector exhibit stress. The CBN should be prepared to give banks liberal access to its loan discount window to ensure adequate liquidity within the banking sector. The Cash Reserve Requirement for banks should be revised downward.

“Also to ensure liquidity, the CBN should be willing to expand its balance sheet and improve liquidity by purchasing government bonds and other instruments held by banks and other institutions.

“The Nigerian stock market is falling. CBN and others should be planning how they might intervene to prevent a potential run on the stock market. Potential measures include expanding Quantitative Easing to enable the Central Bank to purchase strategically important instruments trading in the stock market and instituting a moratorium on margin calls.

“EXCHANGE RATE: The Corona crisis will shrink the inflow of dollars. Hopefully, this is temporary, no more than a few months. CBN can allow some downward pressure on the naira without energetically intervening to defend the exchange rate. Only if and when the rate seems that it might dip precipitously should the CBN intervene.

“The Bank may want to revisit its decision prohibiting non-institutional Nigerian dollar holders from participation in Open Market Operations. Greater leniency will bring more dollars into the CBN.

“DEBT SUSPENSION: If economic trouble does come, government must be willing to freeze payment of certain consumer-related private debts. Evictions, foreclosure and light and water cut-offs might have to be suspended. Suspension or partial reduction of payment of school fees for our most indigent families must be considered (that is when schools reopen) while government offers temporary support to the schools themselves.

“INCREASE STIPENDS TO THE POOR: We must be ready to increase stipends to the poor. We do this by widening the net, substantially increasing the number of recipients of anti-poverty stipends.

“In conclusion, I proffer these measures not as some comprehensive solution. I hope these ideas spark needed dialogue about the ways we may need to employ to protect our nation from assault by the coronavirus. I do not know if such a confrontation shall come. What I do know is that wise preparation will carry us close to victory. Unity, compassion and brave implementation of good policy will take us the rest of the way home. “



Tinubu said that this point, the Government should announce a tax credit or partial tax reduction for companies or firms and suspend VAT for the next 2-4 months, adding that “This will help lower import costs and protect against shortages.”


He advised the government to maintain its expenditures, adding that the natural instinct will be to reduce spending.

The APC leader said that such reductions may be prudent for individuals and households, but maintained that for government to move in this direction only feeds economic carnage by amplifying economic hardship.

“Prudent fiscal policy is generally ‘countercyclical.’ As the private sector shrinks, government does more,” he added.


“At minimum, the federal government must stick to its naira budgetary expenditures. In fact, government should increase naira expenditures by at least 10 – 15 percent during an emergency.

“Allocations to state and local governments should be included in this addition. If not, we risk subnational recessions in important sections of the country.”

He further advised that if the virus is largely kept from becoming a widespread public health menace, “government should accelerate spending and actual work on key infrastructural projects particularly regarding transportation. This will lower costs while bolstering the economy by generating employment and business activity.


“If the virus does become a large-scale public health challenge, more funds should be allocated to the health sector.”

Tinubu said, “TAX REDUCTIONS: Government should announce a tax credit or partial tax reduction for companies or firms. VAT should be suspended for the next 2-4 months. This will help lower import costs and protect against shortages.

“FOOD SECURITY: We need to protect the people from food shortages and high prices. As such, we must quickly improve farm-to-market delivery of agricultural produce. Also, government should initiate a crash program to decrease spoilage of agricultural produce by construction of storage facilities in local marketplaces in and around major cities and towns throughout the country.

“We must establish a strategic grain reserve. Government should help ensure supply by establishing minimum premium price for certain food products.

“LOWER INTEREST RATES: CBN should lower interest rates to spur borrowing and private sector activity.

“QUANTATIVE EASING: CBN and other financial regulators should be alert to signs of fragility in the financial markets and banking sector.

“The Central Bank should be prepared to enact extraordinary measures should the financial sector exhibit stress. The CBN should be prepared to give banks liberal access to its loan discount window to ensure adequate liquidity within the banking sector. The Cash Reserve Requirement for banks should be revised downward.

“Also to ensure liquidity, the CBN should be willing to expand its balance sheet and improve liquidity by purchasing government bonds and other instruments held by banks and other institutions.

“The Nigerian stock market is falling. CBN and others should be planning how they might intervene to prevent a potential run on the stock market. Potential measures include expanding Quantitative Easing to enable the Central Bank to purchase strategically important instruments trading in the stock market and instituting a moratorium on margin calls.

“EXCHANGE RATE: The Corona crisis will shrink the inflow of dollars. Hopefully, this is temporary, no more than a few months. CBN can allow some downward pressure on the naira without energetically intervening to defend the exchange rate. Only if and when the rate seems that it might dip precipitously should the CBN intervene.

“The Bank may want to revisit its decision prohibiting non-institutional Nigerian dollar holders from participation in Open Market Operations. Greater leniency will bring more dollars into the CBN.

“DEBT SUSPENSION: If economic trouble does come, government must be willing to freeze payment of certain consumer-related private debts. Evictions, foreclosure and light and water cut-offs might have to be suspended. Suspension or partial reduction of payment of school fees for our most indigent families must be considered (that is when schools reopen) while government offers temporary support to the schools themselves.

“INCREASE STIPENDS TO THE POOR: We must be ready to increase stipends to the poor. We do this by widening the net, substantially increasing the number of recipients of anti-poverty stipends.

“In conclusion, I proffer these measures not as some comprehensive solution. I hope these ideas spark needed dialogue about the ways we may need to employ to protect our nation from assault by the coronavirus. I do not know if such a confrontation shall come. What I do know is that wise preparation will carry us close to victory. Unity, compassion and brave implementation of good policy will take us the rest of the way home. “

from dailypost

11 comments:

  1. Stella, I follow you give Tinubu the side eyes even though his advice could be a good one. With all the money he got from government coffers, what's he doing as a contribution to the poor masses at this point in time? Or is it cos it's not election period when Bullion van will show. Trying so hard to be smart on our intelligent.

    ReplyDelete
    Replies
    1. Let's see your state plan for 50yrs. Tell us your governor. You guys think Lagos is working is joke. Thiefnubu, though I'm not his fan laid down a 50year plan for his state. Others can only copy and hate. Ask any top person in Lagos state if I lie. Next time criticise the article and using a case study by saying what your own state governor has done better. Not hating, but high time we stop ranting and apply constructive criticism

      Delete
  2. Baba has ear infection 😣. So he won't hear. Besides, the "real" president is indisposed.

    ReplyDelete
  3. I thought of this few days ago...

    ReplyDelete
  4. This is a stupid advice! How do you want the economy to function! How many stores or businesses are even open Not to talk of administering VAT.

    You made no contribution to the government to fight covid 19 and you have the guts to talk.

    A lot of individuals, companies and organizations have donated monies running into a trillion, the government can leverage on that to fight covid 19 and also help the masses! That should be your advice MR Tinubu!

    ReplyDelete
    Replies
    1. Even OBJ gave his mansion to be used as an isolation center. Atiku gave 50million. Otedollar did the same. Even Nnamdi Kanu gave 50million. What have Tinubu donated?

      Delete
    2. Jagaban does not give out money except during election. 😁

      Delete
  5. Tinubu you are making sense but we are expecting your own contribution. If you doit give anything then Buba will not listen to you

    ReplyDelete
    Replies
    1. And the billionaire from your state, how much have they contributed to Nigeria at this time. It's sad we only read about their billions, not even actors with medical bills to pay abroad smell their 10kobo, but everyone expects Dangote and otedola to give outside their tribe too. Giving has no tribe we know that, but some billionaire are missing in the giving arena. BUA Alhaji gave cash too towards coronavirus. We are waiting for your billionaires, let's start with the small ones that display Rolls-Royce before moving on to the industrialist in your state.

      Delete
  6. Tinubu you are making sense but we are expecting your own contribution. If you doit give anything then Buba will not listen to you

    ReplyDelete

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