Prince Adetokunbo Kayode, President of Abuja Chamber of Commerce and Industry (ACCI), has called for urgent tax reforms to save Small and Medium Enterprises (SMEs) from stifling demands for tax even before they make profit.
Kayode who stated this while speaking with newsmen in Abuja, explained that the practice of mandatory requirement for tax clearance from companies newly registered was a disincentive for the growth and thriving of SMEs in the country and also one of the stumbling blocks in the Ease of Doing Business.
While noting the ongoing progress in national tax reforms, the ACCI boss advised tax authorities to immediately review the tax clearance system to reduce the burden placed on new and young companies sprouting up across the country.
“The growth of Small, Medium and Micro Enterprises depends very much on the enabling environment the government is able to create for them to grow.
“Their growth will in turn create jobs and collective wealth for the nation. All that is necessary must be done to nurture such new businesses.
“New companies should not be mandated to produce tax clearance until after a year or so of operations”, he noted.
Wondering why tax must be imposed before operations, Kayode said members of the Chamber of Commerce had variously lamented the negative effect of that policy in their efforts to run their legitimate businesses.
“If this country must grow and have a vibrant economy, the plight of the SMEs must be adequately taken into account. SMEs are of fundamental importance to us due the meaningful contribution they add to economic development.
“They are constantly expanding output, generating employment, redistributing income, promoting indigenous entrepreneurship as well as greatly producing primary goods that strengthen industrial linkages. The sector is accountable for about 85 per cent of the total industrial employment in the country and between 10-15 per cent of the total manufacturing output”, the President of ACCI insisted.
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