Ongoing revelations from the Panama report that rich men around the world hid their wealth in some tax haven countries to avoid payment of taxes has again brought to the
fore the age-long issue of citizens’ obligations to their country. They may be universally hated, but taxes are the lifeblood of governments.
The ability – or inability –to collect them points to the strength of a country’s institutions and says a great deal about its stability.
For this reason and others, the recent data dump known as the “Panama Papers” – millions of financial and legal documents detailing thousands of offshore companies used by the world’s elite as tax shelters – has captured the world’s attention. With the gap between the world’s rich and poor seemingly expanding further, some governments are seeking to do away with tax shelters and sounding the call for greater transparency. And in some parts of the world, the Panama Papers headlines have induced little more than a shrug.
Unfortunately, Nigeria is one of such countries. But the socio-political and economic implications of the
disclosure are already taking shape, and will play out for some time to come.
However, one lesson to be learnt from the unfolding development is the need for governments at all levels to intensify tax drive efforts and block all loopholes, and the need for citizens to fulfil their tax duties. Indeed, every government needs money to perform civil operations
and administrate the running of the country. This money is generally collected from the citizens in the name of tax. So, it becomes virtually impossible for government to run without tax. Every country has its own way of collecting tax from citizens while ignorance about tax could lead a defaulter to variety of problems.
Taxes help to develop the infrastructure of the state like roads, hospitals, legal protection, welfare, security, environment preservation and improvement
in the standard of education. Taxes are like income for the
government. Therefore, it is important for every citizen of the state to pay his or her tax regularly. Citizens, especially wealthy individuals and corporate organisations, should not groan for the burden of the tax, instead they should think about the utilities that they receive from tax.
It can be simply said that you are paying rent to live in a
wonderful country. On its part, tax authorities must sensitise the citizenry and make them to understand the importance of paying taxes. One of the most important things that people face in their adult lives is paying their taxes. It can be a bit of a hassle, but it is an essential part of being a responsible citizen, and it is the law.
Being a responsible citizen is something that requires commitment and understanding. Since the funds that are drawn from the activity go back to the government,
they can be instituted to make the overall quality of life better for a greater amount of the population. Most of the time, people are taxed on their income and their assets. The purpose of this process is to draw a ratio amount from people that will reflect the money they
have available.
This means that those with more money will pay a higher
amount, and those with less will pay a lesser amount overall. The greater amount of money that the wealthy need to pay is at about the same ratio level as those in a different economic situation; so both groups give the same amount. Maintaining these ratios ensures that the population is taxed fairly. This prevents one group from being singled out and unduly punished in any way, since that has been a
historical problem in the past with various governing systems. A good government uses taxes to better the condition of the citizens by providing them basic necessities of life as well as security.
For example, interconnected roads and highways that cross the country were paid for and maintained with the funds. Things such as these provide much of the economic backbone of the country; so it is critical that these are maintained and expanded over time.
However, if people have access to basic tax information, then the process of tax payment may be less of a hassle to deal with.