Economic analysts have called on the government to give the organised private sector tax waivers to enable it to pay the newly approved N70,000 minimum wage.
A Professor of Economics and Public Policy at the University of Uyo, Akpan Ekpo, said that the government should give tax incentives to micro, small and medium enterprises.
According to the professor, firms with larger operations that already pay beyond the new minimum wage should be excluded from the tax incentive.
Ekpo said that the best way for the government to support members of the organised private sector, who cannot afford to pay a N70,000 minimum wage, was to ease their taxes so that they could be used to pay the wage.
“The break (for SMEs) should be a tax incentive. In other words, (the government should) reduce their tax burden. It is difficult for the government to start giving them handouts, but I will support them getting a reprieve from the government to help them pay the minimum wage,” the economist said.
He justified the need to assist SMEs by stating that small businesses had been through challenges, including foreign exchange instability and epileptic power supply.
Ekpo said there would be a risk of massive layoffs by SMEs if they were not assisted.
“Some of them (SMEs) were not paying the former amount of N30,000 before it was increased,” he noted.
Another economist and the Chief Executive Officer of the Centre for Promotion of Private Enterprise, Dr Muda Yusuf, in a chat, agreed with the position of the OPS.
Yusuf said that the current operating environment was extremely challenging for most businesses in Nigeria, especially in the real sector and small businesses.
“There are macroeconomic headwinds, there are structural impediments, and there are multidimensional supply chain challenges. The profitability and sustainability of many businesses are at risk,” the CPPE boss said.
