By Boris Esono Nwenfor
The fourth edition of the Nkafu debate has been
organized with debaters arguing for and against the motion, “Will more taxes
increase fiscal revenues in Cameroon? The debate organized by the Nkafu Policy
Institute of the Denis and Lenora Foretia Foundation in partnership with Atlas
Network at Mansel Hotel in Yaounde represent a platform par excellence for
non-politicized debates, based on evidence, facts, and statistics.
The objective of these debate is to give Cameroonian
and African high-level experts the opportunity to objectively address a set of
issues related to our country’s economic development.
The debate panel constituted two experts arguing for
the proposition and two against the proposition in a 90 minutes session. They
defended their point of view based on facts, statistics, and experience. The
debate focused on the best way for governments in Africa to increase fiscal
revenues with a focus on Cameroon.
“Enterprises are the umbilical cord of every country.
I encourage the government to review tax policies, consider a significant
reduction in taxes, easy access to documentation, and tax centers, and a change
in mentality of tax collectors”, Edison Ngeh, Tax consultant and Entrepreneur
at EDOAN Consulting said in his arguments against.
“The present situation of Cameroon keeps the country
where there is a tax burden on tax payers already and if taxes are increased then
more businesses will collapse.”
He added that in as much as taxes can bring revenue to
the government, more taxes can actually kill businesses. He noted, “When you
look at what the money is being used for, you find out that it is being
embezzled, there is corruption, bad governance, and all of these will create
unemployment and then poverty and low standard of living. What should be done
is fight corruption, embezzlement rather than increase taxes.”
To Ndikombui Nigel, Auditor and Senior Tax expert at Goodwill
Consulting arguing against increasing taxes, He said Tax payers should be
educated on how taxes can conveniently not be a burden. “Also, increasing taxes
will not raise government revenue, but rather discourage entrepreneurs from
operating formally,” He said.
We need real tax education, and entrepreneurs need to
understand that taxes are a citizen obligation. Also, taxes should be directed
to their purpose and the state should not only depend on these taxes to raise
revenue,” Marylyse Noussi, Jurist and Policy Analyst said in her arguments for.
“Taxes are a product, and we must sell the
product to the contributors,” Alain Florentin Zouga, Associate Policy
Researcher at the CPARC noted. “We are currently facing a lot of problems, and
we need to develop our country. For that reason the state need to money, so
they can finance the development of the country.”
“The state should increase taxes, but at the same time
know that the environment should be safe so that contributors (entrepreneurs)
can pay taxes. These taxes should not strangle the start-ups but should serve
as a tool for development.”
Egoh Modi Aziz, Development Policy Analyst at the
foundation said state agency should ensure transparency, accountability as per
the taxes that they collect. “There should be sensitization — ensure that so
many startups are sensitized, and they should also put in place the aspect of
exoneration. They should make sure that the number of years is increased from
two to three years so that new startups can be encouraged to grow their
business, so they can take it from the informal to the formal sector,” He said.
In Cameroon, taxation remains the first obstacle to
the development of entrepreneurial activities (General Census of Enterprises,
2016). Indeed, high taxes prevent entrepreneurs to fully establish and flourish
their activities. In addition, each year the government of Cameroon creates
“new taxes.” For example, in 2019 Budget, a flat rate of 200 F CFA per
application was created for software and application that is downloaded online
via phone or tablet. Moreover, the 2020 Budget bills projects to increase taxes
on cosmetics and artificial hair just to name but a few.
The above situation has led to the development, and
the predominance of the informal sector in Cameroon. The majority of businesses
prefer to remain informal (i.e. approximately 89% of small enterprises) to
avoid being charged high taxes. Consequently, the government cannot fully
collect the projected amounts.