The Centre for Social Justice (CSJ) has enjoined the federal government to discontinue fuel and electricity subsidies to create the fiscal space for funding of infrastructure and other national priority projects.
The Lead Director of the organisation, Barrister Eze Onyekpere, made the call on Monday in Abuja at a briefing on the Medium Term Expenditure Framework (MTEF) 2022-2024.
He also called for the immediate prosecution of persons who have contributed to the economic crisis in the sectors in the interest of national development.
“Savings in the cost of governance and removal of subsidies should be channelled to capital expenditure in critical infrastructure backed by a cost benefit analysis.
“Federal Government should implement schemes requiring the conversion of tax concessions into refundable tax credits. Tax expenditures should be capped as a percentage of overall actual and collectible tax.
It is recommended that not more than 20 percent of the available tax revenue be foregone as tax expenditure,” Onyekpere said.
He said that the opportunity for the review of extant tax expenditures is provided by the annual Finance Act and the 2021 Finance Act should be prioritised.
“Urgent measures are imperative for the recovery of sums due to the Federation Account and the Federal Government as reported in annual reports of the Auditor General for the Federation.
“Special procedures and court proceedings leading to the recovery of these outstanding sums should be devised,” he said.
Onyekpere said special procedures and special court proceedings for the recovery of the outstanding sums should be devised.
He said, “Federal Government should consider setting prudential limits like debt service/revenue ratio to ensure sustainability of federal government’s debts.
“It is recommended that in the medium term, debt service should not exceed 50 per cent of retained revenue.”
The CSJ boss Stated that alternative measures to reduce direct sovereign borrowing including borrowing for Government Owned Enterprises (GOEs) and providing sovereign guarantees should be explored.