A lot of fuss about cyber tax

Very recently, the federal government confirmed the suspension of the introduction of the cyber security levy, which was undoubtedly ill-timed. The levy would be 0.5 percent on electronic transactions. It can easily be recalled that the Central Bank of Nigeria (CBN) issued a circular on May 6, 2024, directing all banks, mobile money operators and payment service providers to immediately commence collection of the new cyber security levy.

The levy was included in the Cybercrime (Prohibition and Prevention, etc.) (Amendment) Act 2024 and amounts to 0.5 percent of the value of all electronic transactions, intended to be transferred to the National Cyber ​​Security Fund, under the supervision of the agency. of the National Security Advisor (NSA), who is directly responsible for security.

This could have been a way to rake in several million naira daily. Despite the ongoing security challenges facing the country which will undoubtedly require a large amount of money and resources, Nigerians have strongly rejected the new tax. The spontaneous reactions of the citizens forced President Tinubu to suspend its implementation so that the government could review the policy.

The reasons for the aversion to this tax are not far-fetched. It came at a very wrong time. Because it was poorly timed, it could not have been popular with Nigerians. Barely a year after the federal government withdrew fuel subsidies, President Bola Tinubu was sworn in almost immediately on May 29, 2023. This has placed an untold burden on the welfare of the average Nigerian in terms of the rising inflation that has accompanied the policy, coupled with millions of Nigerians already plunged into multi-dimensional poverty.

The idea of ​​a new taxation that would be seen as an additional burden on the hapless Nigerians could not have been popular. Apart from that, there was a weak media plan for the policy. The required awareness and consultation of stakeholders were not achieved. The basic assumption that Nigerians are resilient and can swallow anything has not gone down well with the people, at least because it has been taken for granted.

The trust problem between the government and the citizens is missing. The extent of brazen corruption and theft by public office holders does not justify asking Nigerians to buckle down and endure more hardship. Cases of corruption as exposed on a weekly basis by the anti-corruption agencies – ICPC and EFCC – are enough to dampen the spirit of the masses of our people. However, the basic perception of the people, rightly or wrongly, is that revenues will be embezzled in the characteristic manner of public office holders.

The integrity issue has completely evaporated the little trust between the government and the governed, breaking the social contract. This was not the case in pre-colonial Africa. Famous political sociologists in the person of EE Forth and Evans-Pritchard, in their insightful work on African political systems, confirmed the fact that Africans were accustomed to paying taxes and duties.

This could be a poll tax levied on individuals (then only men) or a community tax called Isakole in Yorubaland. With bloody warfare here and there across Africa, communities that had been overpowered or annexed were subjugated and forced to pay annual taxes to the new overlord. This can be in kind or cash, depending on the case. It was given different names in different human communities in pre-colonial Africa.

Meanwhile, in post-colonial Africa, taxation became abhorrent to our people. This is not unrelated to what Professor Peter Ekeh – also a political sociologist – (of blessed memory) regarded as the desire for legitimacy of militant nationalism in the post-colonial era. He recalled that indigenous people in colonial Africa were prevented from paying taxes to colonial governments. He put it succinctly as follows: “The struggle brought with it a necessary but destructive strategy, namely sabotage of the settlers’ administrative efforts.

A large part of the anti-colonial activities of the African bourgeoisie consisted of encouraging their followers to be late for work, to go on strike for all kinds of frivolous reasons.” Ekeh further recalled that “the Africans who evaded the tax were a hero, the African worker who beat up his white employer received extensive coverage in the newspapers. In general, the African bourgeoisie, both within and outside politics, encouraged the common man to shirk his duties and responsibilities to the government… in the same breath he was encouraged to demand his rights.”

Such a strategy, it bears repeating, he concluded “was absolutely a necessary sabotage against alien personnel seeking to replace the African bourgeois class.”

Nevertheless, one can also easily recall the Aba riot of November-December 1929. Subsequently, thousands of Igbo women organized a mass uprising against the policies imposed by the then British colonial administration in southeastern Nigeria. The protest was primarily against special taxes imposed on the Igbo market traders. These women were responsible for feeding the growing urban population in Calabar, Owerri and other Nigerian cities. They feared that the taxes would drive many of them out of the market.

Women were mobilized to disrupt the food supply for the population. Ultimately, police killed as many as fifty women who protested naked to show their anger against the colonial government. It took almost two months before the uprising could be suppressed.

This negative attitude towards taxes persisted even long after independence. The aversion to taxation culminated in another uprising in the Southwest between 1968 and 1969; when the popular Agbekoya uprising broke out. It was the farmers’ anger against the federal government over taxation. Although the Ibadan people of the present Oyo State have fought for and against the Federal Military Government on behalf of the entire Yoruba land. Led by two villages in Ibadan – Akanran, present-day Ona Ara Local Government and Akufo, also in Ido Local Government area – it was the most famous farmer-led political uprising ever in the history of Western Nigeria.

The uprising was mainly aimed at inciting tax cuts; especially a reduction in the flat-rate tax of 8 dollars and an end to the use of violence in tax collection in the region, among other things. The farmers’ war song was ‘oke mefa lao san, oke mefa lao san…’, which means (we pay only 30 shillings).

Many policemen and men, including soldiers, lost their precious lives in the confusion that entailed a personal appeal by the late, wise Chief Obafemi Awolowo to appease the Yoruba gods before the insurgency could be quelled. His cult-like followers and charismatic leadership qualities quelled the situation and stopped the massacre.

Be that as it may, ironically by independence this view of the state as one that could be exploited to advance party interests had become so entrenched that the leaders themselves found it difficult to convince citizens that the state deserved obedience .

It is therefore not surprising that when the Western Regional Government led by Chief Obafemi Awolowo (of blessed memory) sought to levy citizens to finance its free education and free health care programs in the 1950s, politicians found it extremely difficult to dissuade the people. convince the need to financially support the government that wanted to provide welfare services.

On January 23, 1953, Chief Awolowo, the then Prime Minister of the defunct Western Region, in an attempt to convince honorable members of Parliament of the need to levy citizens, wrote: “It would be the height of bad faith and breach of trust to exploit the masses’ ignorance of statesmanship and mislead them into believing that they can get the good things in life for nothing, or that the financial contribution they now have to make for education and health care is exorbitant. ”

Having aided and abetted disobedience to the state regarding the payment of taxes and duties in the colonial era, emerging political leaders after independence found it extremely difficult to convince their followers and the citizens that it was part of their civic duties to pay taxes. ! In fact, during colonialism they were prevented from doing so simply because the postcolonial state also exploited them.

It is imperative at this point to emphasize that governments at all levels must buy back their legitimacy by convincing their citizens that they must pay taxes because social services cost money and must be paid for by individuals or by the government. This attitude must have been responsible for the non-payment of electricity bills, including postal services. This incorrect orientation does not exclude places of worship where members hardly pay their tithes and offerings to the church.

If pay-as-you-earn (PAYE) deductions are thrown out of the source system, the government could be shocked that a quarter of its revenues may not come in. Secondly, the government should put a stop to corruption instead of taking the current cosmetic measures. Carrying out short-lived media processes that do not produce the desired results.

Finally, government must deliver the fruits of democracy. If every community and individual gets a better life in terms of social security and basic infrastructure, it can become easier to collect taxes and tariffs. The sorry state of the economy that has impoverished Nigerians is uncalled for and discourages people from paying taxes.

While social services are not offered for free at any time in all regions and climates of the world. The era of the free this and that is gone forever. At best, the government can pump more money in the form of subsidies into crucial sectors of the economy.

Prof. Ojo teaches political science at the University of Ilorin, Kwara State.