The Nigerian Association of Chambers of Commerce, Industry, Mines, and Agriculture (NACCIMA) has urged the Federal Government to reduce corporate tax to 19% and value-added tax (VAT) to 7.5% to stimulate economic growth.
In a report titled “Options for Economic Reform and Consequences for The Medium-Term Expenditure Framework for 2025-2027,” NACCIMA argued that these tax reductions would not only boost economic activity but also lead to increased government revenue in the long run.
Mr. Dele Oye, President of NACCIMA, expressed concerns about the recent Eurobond issuance, stating that the oversubscription indicated that the coupon offered was higher than necessary.
“The successful Eurobond offer was received with mixed feelings,” Oye stated. “We congratulate the financial team on a successful outing. However, the nature of over-subscription confirms the coupon offered was beyond market offers.”
Oye suggested exploring alternative methods of debt financing, such as a Dutch auction, to optimize borrowing costs. He emphasized the need to minimize the impact of foreign borrowing on the Nigerian economy, given the potential risks associated with currency fluctuations and external shocks.
Furthermore, NACCIMA urged the government to:
- Reduce government spending: Streamline government operations and eliminate wasteful spending to reduce the reliance on foreign borrowing.
- Invest in human capital: Prioritize investments in education, particularly technical and vocational skills, to address the skills gap in the Nigerian workforce.
- Promote local production: Encourage the use of locally sourced inputs in government projects to stimulate domestic production and reduce reliance on imports.
- Improve ease of doing business: Implement policies that facilitate private sector investment, reduce regulatory burdens, and enhance the business environment.
By implementing these recommendations, NACCIMA believes the Nigerian government can create a more conducive environment for businesses to thrive, stimulate economic growth, and enhance the country’s long-term economic prospects.
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