NACCIMA urges caution on TSA to prevent illiquidity in banks
The Nigerian Association of Chambers of Commerce, Industry, Mines and Agriculture (NACCIMA) has said that the Treasury Single Account (TSA) introduced by the federal government will ensure fiscal responsibility and transparency in government but urges the monetary authorities to put measures in place that will prevent illiquidity in the country’s banking industry.
“The TSA will safeguard and block loopholes through which Nigeria’s earnings are siphoned by unscrupulous elements in government,” Bassey Edem, national president, NACCIMA, said at a conference in Lagos.
“This would also allow the administration to effectively manage its resources at this time of dwindling income from oil proceeds. However, the authority needs to put a system in place that would prevent illiquidity in the banking sector as a result of the movement of government funds to a central account,” Edem said, while x-raying the state of the Nigerian economy.
President Muhammadu Buhari has signaled that his government will plug leakages and cut down on the cost of governance as government revenue continues to dwindle on the back of falling oil price.
Edem said while the decision to cut costs is commendable, government should ensure that the reduction in the cost of governance does not impact negatively on the efficiency and productivity of government workforce. He suggested that savings from the reduction in the cost of governance should be directed to capacity building of institutions and personnel so as to positively impact effective service delivery.
Nigerian businesses are hardly certain about the number of taxes they pay. In some cases, the identities of tax collectors are unknown to entrepreneurs, contrary to the basis canons taxation.
NACCIMA helmsman said it is impossible to ignore the serious negative impact of multiplicity of taxes and levies and the imperative of ensuring that this burden is mitigated. There is also no harmony among various levels of government as each, in a bid to generate revenue, sometimes overstep their boundaries.
“We counsel that the three tiers of governments should intensify efforts at addressing the challenges that are inhibiting the harmonisation of different taxes at all levels of government and effectively address this problem so as to further reduce the incidence of undue harassment of private sector operators by revenue officers from the three tiers of governments,” he said.
On traffic gridlock in Lagos, Edem said NACCIMA believes that, after due consultation with stakeholders in the transportation / maritime sector, constructive discussion to find a lasting solution to the problem should continue until a lasting solution is proffered.
He said the interest rate still hovers between 17 and 28 percent in the financial institutions, stressing that it is a major challenge to the business community.
“This may continue as long as the Central Bank of Nigeria retains its Monetary Policy Rate at 13 percent. We counsel that the federal government should revisit and consider the need to bring down the rate to a single digit, which will automatically force down the lending rate in the banks,” he added.
ODINAKA ANUDU