FG SAYS THE FINANCIAL SYSTEM REFORMS AIMED AT ENCOURAGING PORTFOLIO INVESTMENTS, INTO THE STOCK MARKET 01-08-24
By Sadiq Aminu The Federal Government says its reforms in the financial system are aimed at encouraging investments, portfolio investments, into the stock market, government securities, and foreign direct investment.
The Minister of Finance, Mr. Wale Edun, stated this in Abuja after he led representatives of the banking sector to President Tinubu to seek details of the content of the recently imposed Windfall Levy.
“Of course, we know at this time that the banking system is raising money. They’re selling shares, they’re giving people opportunity to participate in their wealth, and that includes foreign investors. So it’s against that background that the Chairman of United Bank of Africa, UBA, Mr. Tony Elumelu and that of the FCMB, Mr. Ladi Balogun, wanted some clarifications, particularly on the windfall levy that has just been passed by the National Assembly, he said.
Relaying the Chairman of the Federal Inland Revenue Service, Mr. Zacch Adedeji, the Minister explained that the government’s intention was to simplify the tax regime, focus on taxing profits, and leave companies’ capital alone to grow.
Describing the meeting as amicable, knowledge-based, and data-driven, Mr. Esun further explained that the bankers were expected to share their perspective on the outcome, which include assurance on all sides and support for the President’s macroeconomic reforms.
“The idea is to simplify the tax regime, as much as possible, make it more efficient and less costly for people to even file their taxes and critically to focus on the wealth that’s created, not to focus on the companies that maybe are not doing so well, or to focus on their capital, to leave their capital alone, to grow and make sure that the emphasis is on taxing and levying only the returns, only the profits”, he maintained.
Chairman of the UBA, Mr. Tony Elumelu had said they would support the government’s windfall levy as understood, saying that there is the need to democratise prosperity for Nigerians, and ensure access to a good life for all.
“We believe that where extraordinary income has made a part of, it should go towards helping to alleviate poverty in the country, which is what the government intends to do.
“We support that and we just believe that we should make sure that no one segment suffers and that the government is able to continue to create jobs and that businesses are also able to do well because we need mutual prosperity”, he said.
On his part, the CEO of FCMB, Mr. Ladi Balogun, expressed the importance of aligning the banking sector and investment community with the government’s reform agenda.
He underscored the banking industry’s role in channeling gains back into the economy, demonstrating their commitment to supporting economic growth, praising the administration’s pro-investment and pro-growth stance, evident in their willingness to listen to industry concerns.
“We also sought to ensure that we are also playing our role as a banking system, as an industry, to be able to channel back some of the gains that we have made into the general economy. Now we believe that this government and this administration is very much pro-investment, is very much pro-growth and they demonstrated that in listening to the concerns of the industry”, he said.