Abia Adopts Digital Tax System to Check Leakages, Enhance Revenue

Emmanuel Ugwu-Nwogo in Umuahia

Following his avowed determination to shore up the revenue profile of Abia State, the state Governor, Alex Otti, has finally settled for a digital system of tax collection.

The new tax system introduced for transporters and traders, according to the governor, would help the state eliminate fraud, extortion, and intermediaries in revenue generation.

Before the new administration came on board, ‘revenue collection in the state was a bazaar for a political settlement with collected revenue going into private pockets.’

Otti had at the outset of his administration sacked all revenue collectors and agents, and stopped all levies imposed on commercial drivers, tricycle, and motorcycle operators.

Basically, the new digital tax system is targeted at sanitising the revenue generation in the transport sector and the markets. While the ‘Permit to Operate’ tickets target those in the transport business, the ‘Innovative Traders Tax Payment’ is for traders in the markets.

While launching the new tax system, the governor gave the assurance that the state would be placed on a strong footing to reap immense benefits in tax revenue.

According to him, “By simplifying tax compliance procedures, we have removed barriers for businesses, encourage formalisation, and stimulate investment.

“This initiative empowers entrepreneurs, enabling them to focus on their ventures’ growth and expansion, ultimately leading to job creation and economic prosperity for our state.”

Otti said the new tax system has a feature for “eliminating fraud, intermediaries, and introducing the digital platform to block leakages,” adding that it “will unlock the true potential of our tax system to maximise revenue for development projects.”

The governor, who was flanked by some senior members of his cabinet, including the Chief of Staff, Dr. Caleb Ajagba; the Special Adviser on Internally-Generated Revenue, Mr. Chimereze Isaac Okigbo, and the Special Adviser on Policies and Interventions, Rev Father Christian Anokwuru, emphasised that the new system has many economic benefits.

On other benefits of the digitalised tax system, the governor said it would eliminate tax evasion, as the new tax regime will “ensure that every business, large or small, contributes its fair share towards the growth of our state.”

He said with the expected increase in  the state IGR, his government “can invest in infrastructure development, education, healthcare, and other essential sectors that will uplift the lives of all Ndi Abia.”

The governor said the new system is not only simple and transparent but also flexible, as the traders and transporters could choose when to pay either on a daily, weekly, monthly, quarterly or yearly basis.

“By simplifying tax compliance procedures, we have removed barriers for businesses, encourage formalisation, and stimulate investment.

“This initiative empowers entrepreneurs, enabling them to focus on their ventures’ growth and expansion, ultimately leading to job creation and economic prosperity for our state,” Otti said.

He explained that the free medical insurance scheme component of the new tax scheme is a fulfilment of his campaign promise “to create an affordable health care delivery for our people across all sectors and segments in the state.”