Special Report.... Legal Luminary Prof Mike Ozekhome SAN Candid impressions of Nigerian State Governments' Reliance on Taxation

Senior Advocate of Nigeria, Mike Ozekhome, SAN CON OFR and and a Nation builder recently expressed concerns over the Nigerian state governments' over-reliance on taxation as a means of development. According to Ozekhome, this approach stifles economic growth and discourages production. He advocates for policies that promote production, investment, and entrepreneurship, rather than relying heavily on tax revenue.

*The Problem with Taxation

Ozekhome's criticism highlights the limitations of taxation as a primary source of revenue for state governments. Excessive taxation can lead to economic stagnation, as it reduces the disposable income of citizens and increases the cost of doing business. This, in turn, can discourage investment and hinder economic growth. Furthermore, over-reliance on taxation can create an uneven tax burden, where certain groups or industries bear a disproportionate share of the tax load.

*The Need for Productive Policies

In contrast, policies that encourage production can have a multiplier effect on the economy. By promoting entrepreneurship, investment, and innovation, state governments can create jobs, increase economic output, and generate revenue through sustainable means. Ozekhome's call for a shift in policy focus is timely, as it recognizes the need for a more diversified and sustainable approach to economic development.

*Benefits of Production-Oriented Policies

Production-oriented policies can have numerous benefits, including job creation, increased economic output, and improved living standards. By encouraging entrepreneurship and investment, state governments can create an enabling environment for businesses to thrive, leading to increased revenue generation and economic growth. Moreover, a focus on production can help reduce dependence on external factors, such as fluctuations in global commodity prices, and promote economic stability.

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*Challenges and Opportunities

Implementing production-oriented policies will require state governments to address various challenges, including infrastructure deficits, insecurity, and bureaucratic bottlenecks. However, the potential benefits of such policies far outweigh the costs. By creating an enabling environment for businesses to thrive, state governments can unlock new opportunities for economic growth and development.

*Conclusion

In conclusion, Ozekhome's critique of Nigerian state governments' reliance on taxation highlights the need for a more sustainable approach to economic development. By promoting production, investment, and entrepreneurship, state governments can create jobs, increase economic output, and generate revenue through sustainable means. As the country seeks to diversify its economy and promote economic growth, policymakers must consider the significance of production-oriented policies in achieving these goals.

*Recommendations

To address the challenges highlighted by Ozekhome, state governments should consider the following recommendations:

- Develop policies that promote entrepreneurship, investment, and innovation

- Create an enabling environment for businesses to thrive

- Invest in infrastructure development and human capital

- Reduce bureaucratic bottlenecks and promote ease of doing business

- Encourage diversification and sustainable economic growth

By adopting these recommendations, state governments can reduce their reliance on taxation and promote sustainable economic development.

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