The governors allegedly put out 33 pieces of advice or suggestions to President Buhari since July. These suggestions came out during the week. Some make sense, but most were rubbish. Coming at such a time, it is obvious that the governors – if they indeed brought out these suggestions – were taking the piss, as the Brits would say. They suddenly woke up from their slumber, having maxed out on their power, their enjoyment and consolidated their financial positions to tell the president to pay off any civil servant over 50 years old. Most of the governors are over 50 years, so they too should resign forthwith, right? Are they not also purportedly working for the country? They told the president to immediately remove the fuel subsidy – and thereby create maybe 300 per cent inflation which will have people on the streets rioting. Whoever suggested that is a maniac. They also said the government should suspend planned increases in civil servants salaries – increases that were planned to help these workers cope inflation which could really already be as high as 40 per cent. I laughed out loud when they suggested that the N19 trillion CBN exposure through ways and means to the federal government should be converted to 100 years bond at one per cent. Who will buy that crap at such a rate? Delusion indeed. Whoever it is that wrote the suggestions – because I don’t think it could have come from the governors – also suggested immediate increase of VAT to 10 per cent with a view to targeting 20 per cent shortly. The person is indeed maniacal, as he suggested that everybody – even poor people earning nothing or N30, 000 be taxed going forward. They suggested minimum taxes of N100 be deducted from the phone balances of people by government no matter what they earn – even those who depend on donations from friends and family. Imagine that!
None of the suggestions considered what the elites could contribute. No mansion taxes. No property taxes. No luxury taxes. No increases in the taxes of those who already earn a lot. The governors and their friends are to contribute nothing. Nothing on capital gains taxes. So, do not be surprised that the average Nigerian is great at telling others what to do, never what he too could contribute to saving a dying nation. Everyone is interested in maintaining their own class advantage. God help us.
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Going after black money – a national imperative
From my own angle, whereas we should get stricter with taxes – and incorporate the ones I mentioned above among others – we should also as a matter of national urgency, go after black money. This should be a national imperative and is already so late in coming. Nigeria has serious problems with corruption and bribery, stealing from government, kidnapping, embezzlement and privateering of collective resources, money laundering and other such underground crimes and what have you. This means that we must constantly clean our system. I am, however, not sure anything has been done in this regard since the return to democracy in 1999.
Meanwhile, many countries without half our problems are moving right ahead in cleaning out black money and ensuring the following advantages for themselves:
- Ensuring most of their money supply resides in the banking system so that banks can be liquid and lend to the real sector
- Reducing the influence of the crime economy and making it less attractive for citizens and foreigners to get involved in crimes because they cannot power illicit funds through the system
- Reducing cash in people’s homes and therefore vulnerability to crimes
- Making it harder for currency forgers through innovation
- Knocking out corruption in a big way by reducing cash slushing around the country
India did this in 2016 and 2017. They targeted high-denomination money which the government believed were being stashed in different places, proceeds of corruption and crime and criminality. The government was able to clean out R15.4 Lakh Crore (equivalent of $26 billion). Another such amount may have been permanently lost by those who could not exchange their money within set time.
As we speak, the UK has set a deadline for those holding the old 20 and 50 bank notes (their highest notes), to change by September 30, 2022 or lose the money forever. The Americans also change the $100 note from time to time. Many Nigerians who hoard the old dollar lose out bigly when this is done. Also right now, the UAE has changed some of her currency notes into polymer and phased out old ones. Polymer looks to be the new preference. It is usually not very convenient to carry around in large sums. And it is much tougher to counterfeit. The world is de-materializing cash, and in many places it is now odd to carry cash or even card. With your phone, or even a chip in your body, you can do banking transactions.
This initiative is very critical to Nigeria more than all these unnecessary speculations that are putting everyone in trouble. We need to get our minds collectively away from speculating about the Naira and putting ourselves in trouble. Any leader that cannot commit to this cannot start the war against corruption. The idea is to first de-democratise corruption and make it more difficult for anyone to get involved. Today, Nigerians are involved in corruption and sundry criminality because they have seen that our government is a joke. This effort will then be complimented with a major reorientation programme and constant repetition of what we intend to achieve with our nation. It will be great if Buhari can try this, and therefore firm up Naira value a bit before he leaves. If he doesn’t, the next government should seize the initiative. People will fight back. But this is a war for and on behalf of the oppressed millions.
People stashing naira at home (in septic tanks and so on), should be made to bring the money back into the banking sector or lose them. Those who are sitting on dollars must be made to sell to government at a handsome premium while government incentivizes the ‘Mallams’ who stand on roads to find another profession. By a systematic approach to clean up the system, and ensure only officially recognised BDCs are in that space, the gap between the two markets should close and Nigerians should even stop talking about ‘black market’. The CBN should also be able to haul in so much dollars and therefore get more efficient in meeting legitimate transactions. Serious sanctions should also be meted against black market dollar trading such as to make it no longer tenable for anyone to get involved. All BDC transactions should also be backed with documentation as is done everywhere in the world.
Nigeria must rise.