Being text of the speech delivered by the Comrade Governor, Adams Oshiomhole at the stakeholders meeting on taxation in Edo State to explain the new property tax law in Edo State.
I called this session today, so that we can speak on the new land use charges. We know those with vested interest have chosen deliberately to misinform the public and they have tried to give the impression as though the law is meant to impoverish the poor. But that has always been the case. People who have benefited and who are benefitting from a system that has impoverished the people will do everything possible to sustain that system. But the truth is very stubborn. It is like gold. If you like dig a grave put the gold and cover it, if you come back there ten years later, it is there. Nothing will happen to it. If you get angry and heat it and you take it out, it will start to shine even better.
If you get even further provoked and tried to hit it with the strongest hammer on the planet, it will turn to a different design. Therefore, I thought in the midst of this deliberate attempt by few individuals to turn the truth upside down and even use people as victim of their own abuse, I thought we should organise a meeting such as this to give us the opportunity to speak to you and speak with you and the opportunity for you to ask any question.
Where we are coming from
Let me start from the beginning. In asking Edo people to elect me to preside over their affairs, I never pretended to anyone that my family has the resources with which to develop Edo State. If I had said so, none of you who know me well will believe because my father did not die as a millionaire. What I did promise was that I believe that there were enough resources in Edo State, when carefully tapped and managed prudently by ordering our priorities diligently; we would be able to build a new Edo State that all of us, our children and even great grandchildren would be proud of. When I assumed office in 2008, the revenue accruing to Edo State internally was an average N300m a month. Even that N300m was being collected through tax agents who were paid between N65m and N70m.
I am happy to say that the first thing I did when I assumed office was to terminate the illegal contract. So, if I have committed any sin, it is that I insist that the revenue of Edo State must be judiciously applied in a way that will deliver welfare to the people of Edo State. But having revoked those bleeding points, we decided to re-constitute our revenue board. Rather than appoint my friends or associates or my fronts as revenue collectors and be paying them a percentage of what is collected, we prefer to build an institution that would provide skill for our people. Government will come and go, the board will remain, and the official memory will be retained so that we can build a data bank which a future government can rely on if it wishes. I am happy to say that we did take some difficult decisions at the beginning including asking everybody to pay correct tax.
We tried to bridge the gap between those who were paying higher taxes and those that were not paying at all. We identify with the weakest ones among us and the state must provide protection for the weak. In the course of one of the meetings, I was reminded that the governor does not pay tax. That is the Federal law. That weakened my own moral basis, if I don’t pay tax, what right do I have to be managing tax payers’ money, which means I have no stake in the process. As of today, those laws have been amended and from the President of Nigeria to my humble self, all of us now pay taxes according to pay-as-you-earn law. Everybody across the length and breadth of Edo State who is taxable, we have encouraged them to contribute something. My promise was that we will apply the law without fear or favour.
The law does not know if you are a rich man. It expects the rich to behave more responsibly, because they benefit more. They have greater stake if the system collapses. According to Karl Max, if there is confusion, the poor like the prisoner will have only his chains to lose, but the rich man will carry his house, cars and his estates. But the poor man will just run. He does not have anything. So, the rich must understand that they have a greater stake. Those who are rich should ensure that the country live in peace and the poor are given every reason not to attack the rich. We have to keep them busy, we must put food on their table, we must create employment, and we must use the instrument of state to address public welfare. Otherwise there would be no peace in the society.
We have been able to raise our revenue by blocking loopholes and creating other avenues. Late last year, the revenue got to about N2billion a month. But you also know that the salary earners complained. They complained that they pay too much tax not only in Edo State but across the country compared to the propertied class.
As a result and after due consideration, there was a downward review of the personal income tax depending on their grades. We have reduced their tax liabilities. This has brought down our internally generated revenue. From about N2b, it dropped to one N1bilion.
Having seen that our revenue was going down and our personal cost was going up, I have always at every opportunity said that my responsibility as the Governor of Edo State is not to lament why things are not working. My own responsibility is that when people are lamenting that their children do not have good schools, it is my duty to deal with that so that they stop those lamentations. You must be able to address what people can see today and even the one of tomorrow which people cannot see. I believe that there are some civil servants in this hall, who know that in year 2000; about 7000 civil servants were sacked. They were dismissed, including permanent secretaries and none of them was paid their gratuity and pension. Today, it is my lot to look for resources to pay those people who were sacked in the year 2000. Look at Bendel Breweries, we would have revived it but the debt hanging on Bendel Breweries was getting to almost N2b. We had to intervene, negotiate and persuade the banks and entered into a deal with AMCON that bought the debts which we are now paying on installments. Last year, the Federal Inland Revenue Board obtained a court order for them to deduct almost at once accumulated value added tax and withholding tax, which my predecessors accumulated amounting to almost N1.6bilion.
Government is a continuum
Government is continuity. Today, as we speak, it is my lot to look for money to settle accumulated VAT and withholding tax that accrued since the year 2000. I saw in the newspapers two days ago, the NUT served notice on fifteen state governments who are not implementing the Teachers Special Allowance. By the special Grace of God, Edo State is not on that list.
Our responsibility is not to lament. My duty is to find answers. Those answers may not be painless, but the answers which in the long run would deliver positively which would more than compensate for what anybody would have suffered. We are not ready to hand over our states to receiver managers. That would not be our portion. We must get the Edo project on and I am happy it is on. But in our search for more resources we have identified the direction we should look at. I did argue when I was in the NLC and I still believe in the argument that you cannot say that because a sick person is dying and needs blood transfusion, then you now go to another man who is already suffering and ask the person to donate blood to support the one that is terminally ill. If you do that, you will be terminating the life of two people. Before you can donate blood, you must yourself have enough blood.
Helping the poor in our society
In our search for solution to meet the development obligations, we are not going to turn on the poor to raise money for the Edo projects. The poor needs support. Therefore, this government will never, ever under any excuse evolve policies that would affect those we classify as poor. What we are determined to do is that those who are rich were born equal like you and I. That they have become rich is a matter of economic history and luck. One of the most important resources of Edo State is our land. This land is God-given. Nobody can say he brought land from heaven. While majority of our people are living on 50ft by 50ft, and the old traditional face me I face you, there are others who live in 10,000 square meters, such a large expanse of land. What we are saying is simply that, individuals in such kind of houses cannot pay same taxes. That will mean furthering the inequality gap.
There is only one God in heaven. You can’t take so much land and you do not want to pay tax on it. You have squeezed a majority of the people into a cubicle and you take a football field. This new law simply states that all our poor people who live in high density area will not pay anything.
We won’t take blood from a sick person to treat another person. So, if anybody tells any villager that Oshiomhole government asked them to pay property tax, it is a lie. The tax has nothing to do with them. Market women are my people, I know where they live. This law is not about them. It is meant for those who have choice houses in certain parts of the state. For example, I am looking for a land where I will build my house in GRA, but I must be ready to pay the appropriate tax once I get one. That is the spirit that goes with this new law and it is expected that the rich will comply in order to help the poor.
Students who are said to be protesting are supposed to be in the fore front if we are going to deliver free and qualitative education. They want bursary awards but they don’t want the rich to pay tax, because they say they are tenants. This is not a tenant’s law. It is about how to meet up with the challenges in the society; how to address them and give our people a sense of belonging. Like President Obama said when they were campaigning last month, he has to collect more taxes from the rich and propertied class which is just like two per cent. He will not collect from the poor and the middle class so that there will be money to rebuild the American Educational system. His opponent said we need rich men so that when the table is full, the one that falls under, the poor man can grab. Obama said, we don’t want rich men to be generous. Let them pay their correct taxes so that we can invest in research, invest in education; we build our human capital industry, create employment and keep America going.
That is what we want to do in Edo State. We must get the top two per cent to pay more taxes so that we can provide more facilities for the majority of our people. We have already demonstrated that. We are already offering free education from Junior to Senior Secondary School. This land use charge is a levy on the owners of large properties and large expanse of land in the state. If a landlord decides to pass that burden to a tenant, he will be taking unmitigated risk. I, therefore, wish to call on the students’ community not to allow themselves to be so corrupted as to take the burden of their oppressors as their own fight.
This bill is sponsored by the Governor of Edo State. I need you to understand what is going on. When the governor forwards a bill to the House for consideration, following the rules of the House, it is the Majority Leader who takes the bill before the House and defends it. It does not mean he is the one who sponsored the bill. That bill was an Executive bill. They did not just stop at twisting the facts; they also try to misinform the public.
It is pertinent to note that there is no hiding place for evil doers in our strong determination to move the state forward. We will continue to advance policies to promote the common good because it is only when our people are happy, that we can have rest of mind to carry out our responsibilities. It will interest you to know that I conquered fear at the age of 18. I can’t be afraid now. My crime is that I insist that everybody should be seen to be under the law and I would operate the law equally. You know in the past we have shut down First Bank, Access Bank, NTA, PHCN, PPMC and UNIBEN, UBTH and by Court order we took almost N650m as accumulated tax. We have not used the law discriminately, but we asked ITV to pay, they were threatening and when they refused to pay, we shut it down, if they refuse to pay tomorrow, we will shut it down. Everyone must subscribe to the tax law.
What I promised is that we will be fair and just to all. The reason Nigeria is not making progress is that for too long the poor have been subsidizing the rich. While the rich are talking of withdrawing subsidy, the poor have been subsidizing the rich. That subsidy must stop. The reason Nigeria is where it is today is simply that for too long, some people are above the law. While I am here as the Governor of Edo State, everybody must be under the law. Thank God we have the support of the only person who has what the rest of us do not have, the paramount traditional ruler who can say I own the land by reason of our traditional law; that is the Oba of Benin. Happily, he has been very supportive. And as we speak, those who are resisting these taxes, are collecting royalties on land from farmers who they have rendered tenants. Government-owned lands that were de-reserved for them to use, they have sub-let to Yoruba farmers and they make as much as N40m per annum. I will like to serve notice to my fellow Edo people that my mission here is not only to rebuild roads, schools, hospitals, to restore infrastructure, it is also to ensure that there is justice. We will respect everybody’s age, but every elderly man must look at the child with pity, sympathy, care and love, not carelessness. If you live your home to the village square to dance, people have a right to clap for you or to boo you depending on your dance steps. If you don’t want all that, don’t descend to the village arena.
So, let me state that we will respect everybody that deserves respect but we will enforce the law exactly the way it is. God expects everyman of authority to be fair to all irrespective of the economic circumstances.The law is basically designed to ensure that those who take so much land pay a little more so that we can build the state and provide for those who have no property.This law is not for tenants, it is not for Churches, it is not for traditional family houses, it is not for mosques, it is not for palaces, burial grounds, and owner occupiers, but it is for the rich who have choice houses in certain parts of the state.
This law is basically for the rich and those who are almost very rich. And above all, the resources that will come from this process will be used judiciously to rebuild Edo State. You know we have started; we would not stop until every part of Edo State witnesses development. Forward ever, backward never.