THE NIGERIA LABOUR CONGRESS CONDEMNS THE 6% STAMP DUTY ON TENANCY AND LEASE AGREEMENTS IN NIGERIA
We read with dismay the new policy by the Federal Government through the Federal Inland Revenue Service (FIRS) stipulating a 6% stamp duty fee for every tenancy and lease agreement in Nigeria. This new financial burden on poor Nigerians comes at a time when the socio-economic pressure arising from Covid-19 dislocations is pushing many Nigerians beyond the limits.
The Nigeria Labour Congress rejects this new stamp duty policy on rents and leases as it would worsen the deplorable situation faced by Nigerian workers most of whom, unfortunately, are tenants. It is also alarming that we are having a rash of hike in taxes and user access fees when other countries are offering palliatives to their citizens.
We call on the Federal Government and the Federal Inland Revenue Service to rescind this harsh fiscal measure as it is boldly insensitive to the material condition of Nigerians which has been compounded by the Covid-19 health insurgency. Nobody would want to be a tenant if they had alternative. This means that tenants which this new policy targets are some of the most vulnerable people in our society. It would be illogical, insensitive and inhumane to churn out laws that make our poor go to bed at night with tears in their eyes.
The principle of public taxation especially progressive taxation all over the world is that the rich subsidizes for the poor. Every tax policy that would be enforceable must create a safety net for the poor. Recent policies of government indicate otherwise. Accommodation is a fundamental right guaranteed by Nigeria’s constitution. It is unimaginable that tenants who are in the most vulnerable group would be expected to pay 6% tax for accommodation when sales tax is 1.5%. This is indeed a great injustice against the Nigerian poor. Government must take deliberate steps to avoid institutionalizing the widespread belief that it is a crime to be poor in Nigeria.
We understand that the government needs money to run the business of governance especially at this time of economic challenges all over world. But the answer is not in further exploiting the already exploited. There is no doubt that there are other painless ways of mobilizing funds to deal with the exigency of the times.
One of such ways is to reduce official graft and corruption. It does not make sense to ask Nigerians to make sacrifices when they are daily regaled of putrid stories of how public officials are accused of swallowing money in billions and making a comic of ‘fainting’ afterwards. We cannot just continue to treat ourselves like this.
Second, there are thousands of unoccupied houses in different parts of the Federal Capital Territory and indeed many cities in Nigeria belonging to very affluent members of society. As we have always demanded and canvassed, Government should tax such property in order to relieve Nigeria’s daunting housing deficits and to generate the needed funds to run government business.
While we expect the reversal of the 6% tenancy and lease stamp duty policy, we remind government that its highest responsibility is to ensure the security and welfare of every Nigerian. It is a social contract. It is a sacred duty!
Comrade Ayuba Wabba, mni
President, Nigeria Labour Congress
24th July 2020