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Friday, May 24, 2024

Remove All Subsidy – Mimiko

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Comment by Prof. Femi Mimiko on Public Finance c’ttee’s recommendation

The Committee did a comprehensive job. But I have a number of issues:

 

l. Ownership and development of Sea Ports should be put on the Concurrent List to enable both the federal government and the States develop and own seaports.

 

2.The argument for the Sovereign Wealth Fund was well made. But I expected the Committee to address the concern of the States, especially in relation to their right to assent to how much goes into the Fund, as in the final analysis these are monies belonging to the entire federation rather than the Federal Government. I even thought the issue was taken to the courts a while ago.

 

3. I do not support the recommendation for a separate Revenue Court. Any suggestion for a new agency of government must be iron-cast so that we do not begin to create the basis for expansion of the cost of governance that is already atrocious.

 

4.The recommendation on borrowing was cast as if external borrowing is a must-have by government. Given our experience as a nation with external indebtedness, I’d rather we recommend that while we recognise the possibiity of external borrowing to support specific infrastructural projects, government should, however, at all times resist the temptation to borrow.

 

5. I do not support the use of professional tax consultants in tax collection. I’ll rather that we hone the capacity of existing agencies of government to do the job more effectively rather than using so-called professional tax consultants who at the end of the day stiII depend on existing governmental structures for tax collection, and yet haul home so much as Commission.

 

6. I support removal of fuel subsidy. On this, I find it difficult to understand the argument of those who want subsidy to be sustained. It is evident that fuel subsidy in this country is a huge infrastructure of corruption. I then wonder why those who in one breadth decry corruption would at another, defend or argue for the retention of a clear infrastructure of corruption. As things are now, it is evident that the fuel subsidy regime has failed. It does not favour the poor; constraints development of our oil refining capacity; and promotes corruption. It should be removed and the savings put on the proposed social security regime that one of the Committees has recommended. Such can also be deployed to support free education  at both primary and secondary levels; and a scholarship fund for students of tertiary educational institutions who cannot afford to pay their way through school.

 Prof. Femi Mimiko, Ondo Delegate and Vice Chancellor of Ondo State University, Akingba-Akoko

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