Nigsrdumb:




Depreciation is obvious, eg asset depreciation.

I'm assuming you know something I don't, the difference between both is conscious and market induced.

Either way d value goes down.

The credit argument tallies with the taxes.

Taxes put money back into the pockets of the government, keeps the flow of money within the system and everyone benefits, devaluation puts money into the hands of foreigners.

I agree
Governments encourage citizens to spend money within the country. That spurs growth. In certain countries, people even pay some extra tax yearly for keeping money above a particular sum in their accounts. The government would rather that money is spent within the economy even if it's on frivolous things. That's how countries build their middle class.

We wonder how certain sectors in smaller developed countries e.g insurance or entertainment can be worth billions in dollars while Nigeria is grappling with a tiny sum as our budget or how the budget of a state in the U.S is several times more than the budget of Nigeria. A good percentage of that money is from consumer spending. A way they accomplish that is by encouraging citizens to spend.

awesomeJ:


Avoid which is okay.

Evade is criminal.

Dangote avoided around 85bn in taxes in 2018 or so, he didn't evade.

What a brilliant man! I so much love your mindset and useful contributions made so far. I want you to educate me on this tax avoidance thing. Let's say I have a company named AwesomeJ Limited and the primary purpose of this company is to invest in securities e.g shares, bonds, CPs etc. Only securities and nothing else. Assume I receive dividends (net of WHT), interest from both bonds and CPs (net of tax) etc., and then further invest same (dividends and interests collected) into buying more shares in such a way that i don't want to pay more taxes except for WHTs which are deducted at source. How can this be achieved?

NB: before anyone trying to criticize me, just know that i am working in the govt and from what i have seen for the short time that i have been in the system, we are so wasteful as a nation. So fuckin.g wasteful. I hope to get out soon so that my values won't be compromised.

TransAtlanticEx:
Are you meant to stop after one period?No.The subsequent year you will still take it out of circulation via high interest debt instrument again.
So what gives?
How did you know the free naira in the hands of debt market buyers weren't used to chase fx?there's no data for that.
How did dollar get to 465 so quick and where did the naira to buy it come from?
Who were/are the speculators?
I think your guess is as good as mine

You'd only be fuelling a burst waiting to happen. Don't try it.

It's like having a constant salary, using one loan to repay another with interests ramping up. when the bubble will burst, you won't be able to stay afloat.

If Nigeria starts with 20trn credit and you price at 20% planning to keep mopping up at 20% because you're taking a lopsided look.

In just 5 years, that 20trn will theoretically grow to almost 50trn.

If your FX reserves remains constant at $40bn.

The value of your currency relative to your Reserves would go from #500 to a dollar to about #1250 to a dollar in just 5 years. And if you continue for another 5 years, it become about #3100 to a dollar. If something drastic reduces your FX reserves significantly, you'll be worse off. When panic sets in, and most of your citizens start losing faith in your currency, you'll become another Zimbabwe.

awesomeJ:


You'd only be fuelling a burst waiting to happen. Don't try it.

It's like having a constant salary, using one loan to repay another with interests ramping up. when the bubble will burst, you won't be able to stay afloat.

If Nigeria starts with 20trn credit and you price at 20% planning to keep mopping up at 20% because you're taking a lopsided look.

In just 5 years, that 20trn will theoretically grow to almost 50trn.

If your FX reserves remains constant at $40bn.

The value of your currency relative to your Reserves would go from #500 to a dollar to about #1250 to a dollar in just 5 years. And if you continue for another 5 years, it become about #3100 to a dollar. If something drastic reduces your FX reserves significantly, you'll be worse off. When panic sets in, and most of your citizens start losing faith in your currency, you'll become another Zimbabwe.

Do you think I will be paying you 20% and fold my arms?
Do I look Stupid to you?
While I am tying down your liquidity,I am building my reserves too and blocking fx leakages like some irrelevant imports and so on and when I fix things,I hand you your money and crash the rates,just like CBN did.
So no zimbabwe here.

I assure you, the government collects tax from 90% of the citizens. D problem is, D tax collectors hardly remit, and even if they do, it's less than 40%. Just last year, tax collectors came and mop up like 20-5k depending on D size of ur shop, and there are lots of small shops woh. Now the thing is, they did not remit a singls penny to D government account( I know because they cut out one of D guys, who by the way got angry, spilled D beans, I was surprised but D shop owner told me it's normal. That's why they also don't pay the correct percentage).

The ideas here are great, but seriously, you practically need saints from Heaven to collect and put the money for its intended purpose.

Nigerians don't really mind capitalism, they just need "true" men of integrity who really hate corruption and not just pretend to

TransAtlanticEx:
Are you meant to stop after one period?No.The subsequent year you will still take it out of circulation via high interest debt instrument again.
So what gives?
How did you know the free naira in the hands of debt market buyers weren't used to chase fx?there's no data for that.
How did dollar get to 465 so quick and where did the naira to buy it come from?
Who were/are the speculators?
I think your guess is as good as mine

We've discussed how the 465 happened now. it's negligibly correlated to T-bills crash.

The crash happened in October 2019, and dollar was at 360 from October to December, went to 370 in December, and crash back to 360 in January where it stayed till March when covid struck.

Monday March 9, oil lost 30% in a single day. I checked market orders on the nse full offer on almost all stocks full offer at the lowest possible price, oil price single-day crash had sent panic on holders of naira assets, that panic permeated the street FX market dollar started moving towards 390. Fuel got added when FX sales to BDCs got suspended. That's how we got to 480 and now 460.

As per data for how much of retail t-bills money got into FX, the data for that can be inferred from data on bank retail customers FX deposits. that hasn't grown by up to $1bn yoy for retail customers.

The CBN has access to more exact figures so they are better informed about this.

awesomeJ:

We've discussed how the 465 happened now. it's negligibly correlated to T-bills crash.

The crash happened in October 2019, and dollar was at 360 from October to December, went to 370 in December, and crash back to 360 in January where it stayed till March when covid struck.

Monday March 9, oil lost 30% in a single day. I checked market orders on the nse full offer on almost all stocks full offer at the lowest possible price, oil price single-day crash had sent panic on holders of naira assets, that panic permeated the street FX market dollar started moving towards 390. Fuel got added when FX sales to BDCs got suspended. That's how we got to 480 and now 460.

As per data for how much of retail t-bills money got into FX, the data for that can be inferred from data on bank retail customers FX deposits. that hasn't grown by up to $1bn yoy for retail customers.

The CBN has access to more exact figures so they are better informed about this.

lol,fx went to 480 due to speculation,that's why when CBN announced airport reopening saga dollars started flooding the market so much so that abokis refused to buy and price came back down to 420.
When CBN didn't do as they say when they open airport the rates jump back to 470 and now since CBN is pumping small liquidity it has stabilise at 460 range.
All these haphazard movement of price is not caused by real demand but speculation.
Now where did the naira for this speculation come from since all debt buyers used their naira to buy stocks and properties?
Also,who told you real speculators go and deposit their fx in banks? lol.You think they don't know when fx liquidity hit CBN banks won't give them their dollars again?
Did I not warn about this very early on this thread?how did I know?(not saying I am a speculator,but I know how they think).
Bros ehh,leave talk,I don tire.

TransAtlanticEx:
Do you think I will be paying you 20% and fold my arms?
Do I look Stupid to you?
While I am tying down your liquidity,I am building my reserves too and blocking fx leakages like some irrelevant imports and so on and when I fix things,I hand you your money and crash the rates,just like CBN did.
So no zimbabwe here.

You'd only be able to catch up if you're able to grow your reserves at 20% CAGR too. And before you come and tell me "yes, I will even do 30" You should know it'll takes a lot of brilliant work and external factors going your way for you to even maintain your reserves talk less of growing at even 5%.

Our $60bn reserves in '08 should be $108bn today if we had been able to do just 5% CAGR.

you won't even be be able to do 5% talkless of 20% because when you're planning on $66 oil in January, you won't be able to sue anybody when oil goes to $15 in April.

So, with constant 20% mopping up, your bubble will burst sooner or later.

And you wouldn't be proving any point, you'd just be causing unnecessary chaos.

tnota:


What a brilliant man! I so much love your mindset and useful contributions made so far. I want you to educate me on this tax avoidance thing. Let's say I have a company named AwesomeJ Limited and the primary purpose of this company is to invest in securities e.g shares, bonds, CPs etc. Only securities and nothing else. Assume I receive dividends (net of WHT), interest from both bonds and CPs (net of tax) etc., and then further invest same (dividends and interests collected) into buying more shares in such a way that i don't want to pay more taxes except for WHTs which are deducted at source. How can this be achieved?

NB: before anyone trying to criticize me, just know that i am working in the govt and from what i have seen for the short time that i have been in the system, we are so wasteful as a nation. So fuckin.g wasteful. I hope to get out soon so that my values won't be compromised.

Well all I know about taxes on securities is that there are instruments that are free of WHT, so the logical thing would be to choose them over those on which WHTs are charged.

T-bills, bonds, and commercial papers are free.

Fixed deposits and dividends are charged.

apart from stamp duty, there are no charges on stocks purchases, so I don't think there'll be anything to avoid.

For dividends though, if you sell the stocks after the dividends have been priced in rather than after the markdown, you should b able to avoid the tax altogether.

I hope you find this useful.

awesomeJ:


Asking as someone who wants to know, how does NHIS cover folks in the informal sector. motorists and market traders for instance.

And I think it's wrong to keep saying np country taxed people at the point of purchase of goods. I have cited an example of the gas tax in some US states. That voids that argument already.

Is the MTN recharge card suggestion not already being implemented in the banking sector? When you make a transfer of above 10k, you get charged 50 naira. The banks don't own the money, they remit to Government.
The only difference I see is that the Telco charge will be for a specific purpose. In this case, Health insurance.

ultron12345:


Which ASUU?
ASUU that I will break up in the first week if I am president.
How can employees be dictating to their employers? If they don't like their employers policies, then they can resign. Do they try this rubbish at private universities?

Give a live broadcast
Tell all ASUU members to report back to work the next Monday.
Give all ASUU executives at the national, state, and university levels 48hrs to publicly resign from their ASUU positions and denounce the union.
Tell them that those that fail to report back to work (without good reason) and executives that fail to resign will be sacked and sanctioned in the following ways. Passports seized or rendered invalid. Their bank accounts will be frozen. They will be forever blacklisted from working at any government owned institution in Nigeria, be it federal or state. Any state that goes against this and employs any blacklisted staff will be made to forfeit their monthly allocation. The blacklist will also extend to the private sector. Any private entity that employs them will be sanctioned. If you as a bank employment then, then get ready to say goodbye to all government accounts and funds in your bank. If you as a construction company or auditing firm hire them, get then say goodbye to government contracts. Not only will government business be taken away from such private firms, government business will also be taken away from other private firms that patronize these sanctioned private firms. The DSS can even get involved to make ASUU top executives start "disappearing" and getting "kidnapped by unknown gunmen"

Abacha says hello...

TransAtlanticEx:
lol,fx went to 480 due to speculation,that's why when CBN announced airport reopening saga dollars started flooding the market so much so that abokis refused to buy and price came back down to 420.
When CBN didn't do as they say when they open airport the rates jump back to 470 and now since CBN is pumping small liquidity it has stabilise at 460 range.
All these haphazard movement of price is not caused by real demand but speculation.
Now where did the naira for this speculation come from since all debt buyers used their naira to buy stocks and properties?
Also,who told you real speculators go and deposit their fx in banks? lol.You think they don't know when fx liquidity hit CBN banks won't give them their dollars again?
Did I not warn about this very early on this thread?how did I know?(not saying I am a speculator,but I know how they think).
Bros ehh,leave talk,I don tire.

The fact that dollar remains at 460 at the street market doesn't mean there's naira chasing them. Whether it's $1000 traded or $1m the price doesn't indicate the volume. It's only by the trade volume that you can judge whether naira is available chasing it or not, not by the price remaining constant.

You know that holistic view I talked about,
364-day T-bills went below 1% for the first time since I've known t-bills, if your opinion about people pulling out was right, dollar should have gone up to 470 or 480 after Wednesday.

Alternatively, on Friday, come and see liquidity on NSE, market gaining over 2.5% in one day with over N10bn traded. that's compared to the normal 5bn and 0.25% gain the the market would do in a typical session.

awesomeJ:


Well all I know about taxes on securities is that there are instruments that are free of WHT, so the logical thing would be to choose them over those on which WHTs are charged.

T-bills, bonds, and commercial papers are free.

Fixed deposits and dividends are charged.

apart from stamp duty, there are no charges on stocks purchases, so I don't think there'll be anything to avoid.

For dividends though, if you sell the stocks after the dividends have been priced in rather than after the markdown, you should b able to avoid the tax altogether.

I hope you find this useful.

Thank you.

I am familiar with the suggestions you have provided. However, what i mean by more taxes is that i don't want to pay company income tax, education tax and the rest.

tnota:


Thank you.

I am familiar with the suggestions you have provided. However, what i mean by more taxes is that i don't want to pay company income tax, education tax and the rest.

Oh I see.

I've actually thought about this.

I think if your earnings are from tax free instruments and dividends, you shouldn't have to pay CIT.

Like I said, i've actually thought about it. Like if I had a hedge fund, I assumed I wouldn't have to pay any CIT since my earnings are primarily from government instruments that are tax free and dividends that have been tax deducted at source.

That's still my opinion, hopefully someone who's an expert will educate us on this.

Meanwhile I will try look at some bank statements to see if they pay tax on their t-bills and bond interests. if I confirm they don't, it will ground this opinion more.

NSE was 3.71% gain on Friday.

@tnota,

I just looked through zenith's 2019 q1, they had pbt of 57bn.
at 30%, their tax should have been 17.1bn, it was just about 5bn, and the actual corporate tax was just around 300m. the rest were dividend WHT and the likes.

So I think the fact that about one-third of their gross earnings for that quarter came from T-bills and bonds made their corporate tax much lower at 300m versus the expected 17bn

tnota,
you may check cscs 2018 annual report. Things are so clearly spelt out there.

CSCS makes money from charges on our trades on the NSE, but almost half of their revenue is from T-bills and bond interest.

They had PBT of about 6bn in 2018, and while their tax should have been 1.8bn at 30% rate, it was just under 600m.
They clearly stated that 3.8bn of their income was not taxable. That 3.8bn was the portion of their interest that came from T-bills and bonds.

see notes 10 and 13. note 13 is on page 107.

However they paid about 1.2bn eventually due to excess dividend tax.

I deduce the rule guiding the excess dividend tax is that. even though they were not liable to pay CIT on t-bills and bonds earnings, if they diststribute dividends to their owners, the dividends must be such that 30% of it equals or less that the CIT they already paid.

so if you don't distribute dividends, you can avoid CIT altogether.

Happy new month everyone.

it's a new day, a new week, and a new month.

Go to church.

If we keep shunning every idea saying they wont work due to some loopholes that can be exploited then we really arent ready for a solution.


What we should be thinking of is "Controls" - What controls can be put in place to mitigate and ensure these loopholes arent overly exploited.


Let me close with a question - Have you been to an assessment centre for KPMG, PWC, Stanbic or any private organization? Do you see people conducting malpractise there?

Note that these assessments are done in this same Nigeria and invigilated by Nigerians.

maishai:



Oga this system is dead on arrival in Nigeria, Next Common entrance examination of your kids to secondary schools...... go there and witness the legendary level of malpractice that is going on................Go to WAEC, JAMB, NECO,A-LEVEL, POST JAMB, GRADUATE AND POST GRADUATE and witness extra legendary levels of malpractice and someone is suggesting Nigerians Write exams to obtain positions of service

Kill this idea it wont work

TransAtlanticEx:
If you were a profitable businessman,you would know that funding an arm of your business that don't generate revenue is meant to die over time.
Education is not a right,it is luxury!That is why people take student loans that almost kill them in the west so as to get educated.
Government keeps paying for education breeds corruption and diminishes quality as one government cannot fund over 150 tertiary,over 10,000 secondary and primary schools effectively.
If from that your "so called" business I ask you to compulsory feed 20 more families with their children,Can you do it?
Let's say you can,will you do so effectively?You will go to one house,milk no dey,the other house go say butter don finish.
Everytime government,government,government...
I wish I was Nigeria president even for one year,I will solve Nigeria's population and financial problems under one year by ending BS schemes.
If you wanna study,pay for it.If you can't afford it,jump inside lagoon,no one cares.
If you take to crime because you think the government didn't give you education,I have a well funded police that is waiting to kill you or jail you. It's that simple,really.
Better to have few people with quality education that can actually bring good solutions to society than have the entire masses with half baked,dirty,underfunded,daft education

Bro your are just yearning... In economics, population and economic growth go hand in hand. Did you know that in 1960 UK population was less than 50million while Nigeria was almost the same as 50million.... Now fast forward to 2020, UK population is approx 60 million but here in a shit hole country of Nigeria where babies are produced without control and one of the worstest porous borders in the world, has a population of 200million peoples. Tell me, if the UK population was 200million in 2020,do you think resources will go round?

Look at China, they see the reason to slow down but because population and economic growth need to be the same

Yankee is not heaven

RayRay06677:
Yankee is not heaven

chai which country be this? Abi na illegal immigrants...

.

ultron12345:
Biko, I was recently thinking about international school business. From the little research I've done, 80% of Nigerian state capitals (apart from Lagos and Abuja) have enough wealthy people to sustain at least, 2 schools, each with 1000-1500 students charging 2.5 to 4 million per annum per student.

Can anyone else confirm this? What do you think? In your opinion, how true is it?

These kinds of outrageously expensive schools already exist in cities across the country. They are a thriving business in cities like Ilorin, Abeokuta, Kano, Kaduna, etc. You’d find lots of them in those cities. Yes, there’s a market but have you actually been to those schools? Those schools are a totally different world.

The facility is much better than the average school abroad in fact. The teachers they use are paid very high salary. Their recreational centres are total luxury. The classes are fully air conditioned. Their labs (both science and arts) are fully equipped (In every sense of the word). etc...

You’d need really deep pockets to be able to compete against these established options. If you have that deep pocket, then this is indeed a lucrative business. If not, there’s no way to make it work... cos rich people paying that high won’t accept “patch patch”... “help us manage”.

RayRay06677:
Yankee is not heaven

I thought we were done with all these comparison a long time ago. Did you care to look at the streets these guys are sleeping outside? How well the road is finished? How thick the covering these guys use to cover their body? Will anything in that picture be compared with similar standard under the bridges where similar people sleep in Nigeria??
Please quit all these unnecessary comparison and let's hear word for once please

One thing with we Nigerians is that we crunch Numbers easily cos we know the theory but no one ask if the Data being generated to crunch this numbers are precise and accurate, I agree with a lot of what people are saying here.........................but on the issue of Tax, the data all of us here are quoting and using for our analysis is flawed and not accurate,,,,,,,,,Tax revenue collected is grossly under reported for various reasons, you need to visit the offices of our local state and federal governments around to understand this................................... Using the local government i stay in for example, I can never trust the data generated from there.................... The amount plifered daily is humongous from field before it gets to chair-man and auditors table............... The amount of conniving going on is crazy............................................


Good economics cannot survive Corruption

RayRay06677:
Yankee is not heaven

If this was Nigeria now, you would have seen terrible portholes all over the road.

Better to cry in a Bugatti than on Legedizbenz

RayRay06677:
Yankee is not heaven

Lol.
As someone else has said, this line of discussion is done and dusted - nowhere is heaven, but Nigeria's leaders are pushing Nigeria close to becoming hell.

RayRay06677:
Yankee is not heaven

Europe needs this people to do a lot of menial tasks...............If one has ever ran a production facility you would quickly notice the amount of low skilled works needed to be accomplished daily is much and with Europes over-educated population, many europeans are not ready to do this jobs........... for example we know machines need lubrication but no qualified technician or engineer wants to be employed greasing machines all day............................... enter this sort of people you see in the picture......

RayRay06677:
Yankee is not heaven

Lol... Watch how they will gather here saying silly things about how those people in the picture are living far better lives than Dangote in Nigeria

maishai:
One thing with we Nigerians is that we crunch Numbers easily cos we know the theory but no one ask if the Data being generated to crunch this numbers are precise and accurate, I agree with a lot of what people are saying here.........................but on the issue of Tax, the data all of us here are quoting and using for our analysis is flawed and not accurate,,,,,,,,,Tax revenue collected is grossly under reported for various reasons, you need to visit the offices of our local state and federal governments around to understand this................................... Using the local government i stay in for example, I can never trust the data generated from there.................... The amount plifered daily is humongous from field before it gets to chair-man and auditors table............... The amount of conniving going on is crazy............................................


Good economics cannot survive Corruption

Good economics cannot survive Corruption and corruption cannot survive good systems

TransAtlanticEx:
No mind them,they like creating avenues for corruption with all their socialist policies.
It is simple;PAY YOUR HOSPITAL BILLS COMPLETELY OR YOU DIE!!
haba,how hard can that be?

Sounds like a fair game until you need 50 million for a surgery. Or you need to spend several hundreds of millions over the years due to an illness that needs constant therapy. Then you’d know the benefits of everyone pulling their weight together to ensure free universal healthcare for all.

maishai:
There is a very thin line between Taxation and extortion........................... I happen to have witnessed the birth and growth of a local market in the village..................... This local Government Chairmen, councellors, honorables and OBAs generate a lot of revenue from a very humble market from space allocation, store allocation, and vehicles that deliver food stuffs and Goods........even the water provided in this market cant be acccessed by store owners, you pay for this water........yet the market can best be descibed as a Cesspit

The local government never see it fit to take the market to the next level........ All what they are looking for is for you to bring in a new idea, make money and they come for their own cut with all manner of new levies

Most people that talk about taxes on forum are not incident to major taxes.............. You cant make money in Nigeria without the Government rearing its head to collect taxes............

The Government just has to improve its accountability to the people

If you happen to run a medium scale manufacturing facility and Government does not disturb you with all manners of levies and Taxes, Please tell me let me join you there

If you know the amount of businesses that have folded up because of taxation................

I’ve not seen anyone in Nigeria who pays up to 50% of their income as tax. Yes... like half of your income. Sounds ridiculous? Well, that’s how much some people pay on just their income in developed countries. You’d rarely find anyone whose TOTAL tax makes up to 10% of what they earn in Nigeria.

Sorry, but Nigerians are heavily undertaxed. And it shows in our balance sheets, even when we compare our total revenues to other African countries, despite oil still shoring it up significantly. Without oil receipts, Nigeria would not even be able to survive. There’s basically no tax revenue. First, there’s the low tax base, and the very few people captured in the tax net pay very low percentages.