The Minister of Power, Works and Housing, Babatunde Fashola has said the Federal Government have concluded plans to reintroduce tollgates across the country, with finalized designs.
He stated this in an interactive session with the Senate committee on Federal Road Maintenance Agency (FERMA) adding that it will be managed by the private sector and will be located in the old places, 38 points across the Country.
According to the Ministry, when it carried out an audit of roads across the Country, it discovered that some sections were bad.
Fashola explained that many roads in the South East and the South-South built before the Civil War had outlived their lifespans, and are among the worst in the Country, in dire need of reconstruction.
“Funds generated from Sukuk have not been released because of the conditions tied to it. We will try and repair the roads before people start traveling for the festivities in December. We are doing something about that”.
The Ministry is awaiting the completion of the roads before toll gates are introduced, as the Federal Government does not intend to ask road users to pay toll on a road that is bad.
Fashola added that road users would be able to pay for toll on the roads through their phones, emphasizing that money realized would be used for the maintenance of roads.
“While the construction (of gates) is going on, we are working on the design. We want to standardise the design so that when we ask people to come and bid for the construction, we can control what they are going to construct.
“The last part we are working on is the software that drives the management, audit, and payment of toll fares”.
Retrogressive Tax
Retrogressive tax, also known as Regressive tax, is a kind of tax that is usually applied uniformly to all situations, regardless of the payer. Here, a larger percentage of income is taken from low-income earners, than from high-income earners.
While it may be fair in some instances to tax everyone at the same rate; but it is seen as unjust in other cases. Examples of regressive taxes include sales taxes, user fees taxes, and property taxes among others.
Nigeria’s tax on road usage will be retrogressive because all those plying the roads will pay the same amount.
Those driving Lexus Jeep, Passat, Hilux van and even trailer carrying goods will all have to pay the same amount of tax to the Federal Government, though it may be evident that the person driving Passat is regarded as a low-income earner.
Nigeria can however prevent this problem of retrogression by proper use of technology. Some countries use road systems that automatically measure each car to know what is due on it. Some of such systems are connected to the debit account of the driver so that payment is automatic.
Most European countries have regressive tax systems, especially Norway, Belgium, Switzerland, Poland and Iceland.
Statistics shows that the United States has the most progressive tax system, of any developed country. Although, Washington has the most retrogressive tax system, as the poorest 20% of Washington’s population pay almost 17% of their income in taxes, while the richest 1% pay just 2.4% of their earnings. The middle 60% of earners are taxed slightly more than 10% of their income.
