Soludo’s compassionate tax regime: Let Ndi Anambra be the Judge

Gov Soludo

By Paul Nwosu

WHEN the administration of Governor Charles Chukwuma Soludo (CFR) came on board, one of the first things he did was to take a close look at the existing taxes and levies.

His aim was to: first, reduce the tax burden on Ndi Anambra. Second, was to ensure that the minimum they will eventually pay, come into the coffers of the government so that the taxes and levies will be used for constructing roads and generally develop the state to becoming a more livable, pleasurable and prosperous place.

Before now, apart from the formal sector where taxes such as payee, VAT, corporate and others which have been long structured by law and collected seamlessly, collection of taxes and levies from the informal sector especially transport operators in Anambra State have been brutish and hash. The collection was ruthlessly enforced with guns, axes, knifes and cudgels by middlemen and their goons who fixed the rates arbitrarily. 

In the name of managing government “revenue windows” (as it was then called) they end up lining their pockets with money that should go to government coffers. Of everything they would collect, they remit less that 5 percent to government, yet they neither build any public infrastructure nor provide any essential services to the people.

So, while existing infrastructures were suffering wear and tear, the largely informal sector of Anambra State was being bilked huge chunks of their income on daily basis in the name of tax and levy.

Before Governor Soludo intervened, transport operators were paying the following huge sums of money to these “window” contractors: Keke was paying N58,000 monthly or N1,800 daily; shuttle bus – N75,000 monthly or N2,500 daily; Township bus – N90,000 monthly or N3,000 daily; Taxi – N31,200 monthly or N1,200 daily; Mini truck and Pickup van – N65,000 monthly or N2,500 daily and all the transport categories pay levies to their Unions. Intrastate (urban) bus varies from one part of the state to the other. A typical example is from Onitsha to Awkuzu and Aroma in Awka. The trip used to cost the driver N1,500 from Upper Iweka to Aroma or Awkuzu parks, including N900 and N100 surcharge respectively per trip. So if the driver did six trips in a day (which is usually the minimum most of them do), he spends N6,000 plus N1,500 which comes to a total of N7,500 daily. Interstate bus from Anambra to other states pays between N8,500 to N10,000 daily.

After a thorough evaluation of the situation, Governor Soludo vowed that the trend must stop. This led to the revision of transport operators’ levies to be more income–friendly. Government subsequently released the following tariffs: Keke, N15,000 monthly or N600 daily; Shuttle bus, N25,000 monthly or N1,000 daily; Township bus, N30,000 monthly or N1,200 daily; Taxi, N17,000 monthly or N700 daily; the Mini truck and Pickup van, N N25,000 monthly or N1,000 daily.

These payments entitle the transport operators to government identity cards and vehicle stickers that will enable them to operate in any part of Anambra State within the period covered by the payment. In addition to this, the operators will get FREE health insurance with Anambra State Insurance Health Agency (ASHIA).

The only proviso here is that the operator will pay this money monthly to reduce the cost of managing the process and better allow government enforcement team to concentrate on keeping the niggling touts (agboro) at bay so that transport operators can enjoy the full benefits of the new tax regime.

But following the Keke and Shuttle bus operators’ protests over bulk payment which was instigated by those who have fed fat on the old order, Professor Soludo being a listening governor, again gave them the option to pay weekly as follows: N4,000 for keke, but those operating in curfew-affected areas will pay N3,000. Shuttle bus pays N5,000, and taxi pays N3,750. Township and intrastate (urban) buses pay N6,250 weekly and interstate bus pays N7,500 weekly.

In spite of these concessions the grumblings over purported excessive tax in Anambra State appears to still persist. So, finally at a town hall meeting held at Prof Dora Akunyili Women Development Centre, Awka, Governor Soludo once again personally engaged the commercial transport operators in a no-holds-barred meeting. After the mutual frank exchange, Prof Soludo, the listening and compassionate Governor further reduced the tariffs to the thunderous applause and cheers of the transport operators. After every one present agreed that daily payment should be dropped because it will bring back touts (ndi agboro) into the system, Governor Soludo announced the following reductions: keke and taxi will each pay N10,000 monthly or N2,500 weekly. Shuttle bus will pay N12,000 monthly or N3,000 weekly, and mini truck will pay N15,000 monthly or N3,750 weekly. Township bus will pay N20,000 monthly or N3,750 weekly while interstate bus pays N15,000 monthly or N5,000 weekly. Okada will pay N4,000 monthly or N1,000 weekly.

 But before the latest cut by Governor Soludo, some ill-informed commentators on the matter have come out to compare Anambra’s tariffs with contiguous states and even Lagos, all in an obvious attempt to de-market the government policy. In the light of this it has become absolutely necessary to place in the public domain, comparative levies in four neighboring States and Lagos, for Ndi Anambra to be the judge.

In Enugu State, Keke operator pays N200 for each of the 3 official tickets daily, totaling N600 daily. In addition to this, he must pay minimum of another N500 to touts along the road before he gets to his destination, bringing the total payment to N1,100 daily. Shuttle bus pays N550 for each of the official 3 tickets issued daily and he is still liable to pay union levies. If he strays into a different local government area from where he operates he will also pay there. Township bus pays for N200 ticket daily, pays N1,000 per load of bus and pays Union levy. Taxi pays N550 for each of the 3 tickets it buys daily. This amounts to N1,650 daily in addition to Union levies. Mini truck and Pickup vans buy daily ticket of N1,000 and some organized agboros and indigenes collet additional N500 around Emene. Interstate bus buys N900 ticket daily and pays N1,800 for every vehicle load of passengers.

In Abia State, Keke, Shuttle bus, Township bus and Taxi pay between N500 to N600 daily in addition to 3 tickets per N200 which add up to N600 daily. Put together, this come to a total of N1,100 to N1,200 daily. Mini truck and Pick up pay N1,000 while Interstate bus pays N3,500. The mandatory Union levies which they must pay are not included in these rates.

Keke and Shuttle bus in Imo State pay N250 for ticket daily respectively. Township bus and Taxi pay N250 and N500 for tickets daily. In addition to these they are surcharged 20 percent of the total amount paid by passengers for the trip. Mini truck and Pick up vans are sold N1,000 ticket through pin computerized preloaded card. Agboros and indigenes collect N500 for big vehicles and N200 for small vehicles. Interstate bus buys government ticket for N500 daily, pays N300 to NURTW daily and N2,700 per vehicle load of passengers.

The rates in Edo State are not too different from others. Keke pays N400 and shuttle bus pays N600 daily. Township bus and Taxi pay N1,000 and N400 respectively daily. In addition to these rates they all pay N200 if they stray into local government areas other than theirs which is often the case given the contiguous nature of their semi urban areas. Mini truck and Pickup van pay N500 for ticket and are surcharged 10 percent on the cost of goods loaded. Interstate bus pay N2,200 for all the tickets and another N2,800 as surcharge on passengers fare.

In Lagos, Keke pays N2,900 daily in addition to Union levies. Shuttle bus pays N2,500 daily plus 20 percent surcharge of total cost of passengers on each trip of the bus. The rate for the township bus varies. For example, from Surulere to CMS the bus pays N1,500 at the park and N300 at every of the two units they’ll cross before getting to CMS. At the end of the day, the bus ends up paying N2,500 to N3,000 daily. From Mile 2 to Ojodu Beger, bus pays N6,800 daily. Then, the interstate bus pays N5,000 for loading passengers leaving Lagos.

Taxi pays N50,000 for registration and emblem. If the taxi operates outside its route it pays additional levy. It’s important to stress that in addition to these, the driver still pays his Union levies.

One common denominator in all the comparative levies of States shown here is that apart from the daily levies these States charge at takeoff points, there are other payments transport operators must make as they cross different units and local government areas before they get to their final destinations. In addition to that, they are expected to pay levies and dues to their respective Unions.

But the reverse is the case in Anambra State courtesy of Governor Soludo. With the monthly and weekly payments as well as their government identity cards and vehicle stickers, the transport operators are free to work in any part of Anambra State without any harassment. This is inclusive of the free health insurance in case they are ill or in the event of accident. What more can be better than this offer?

We tend to admire the steady progress Lagos State has made and is still making in terms of infrastructural development. We inwardly wish our own dear state is moving at the same pace if not even faster. But the question we shy away from asking ourselves is: how did Lagos get there? The answer is tax, tax, tax… Taxes that people in Lagos pay to government have been responsible for the massive infrastructural facelift that it has continued to experience.

The fiscal culture is not peculiar to Lagos but every developed country that has been able to improve the quality of the lives of its people. Lagos doesn’t produce oil or gas yet her budget in the last 15 years has continued to grow in a geometric progression. The reason is simply tax! The State’s budget in 2022 is N1.758 trillion and for 2023 it has appropriated N1.768 trillion.

Even if Anambra State cannot match Lagos in the immediate short term for very obvious reasons, we can alter our current state given the size of the commercial and industrial concerns domiciled in the State. The State has the right kind of human capital within and outside the country to make it happen. And we have a Governor with the political will and determination to make sure that your tax is transparently deployed. We must face the hard reality that the era of oil money is fast coming to an end and it’s about time we firmly take our destiny in our own hands and show the world that we are indeed the Light of the Nation.

The solution is here! Nowhere else.

***PAUL NWOSU is the Commissioner for Information, Anambra State.