A new Oxfam report has revealed the revenue-generation potentials associated with imposing a wealth tax on the wealthy in Nigeria.

According to the Oxfam recent report titled ‘Survival of the richest: how we must tax the super-rich now’, the revenue-raising potential of a wealth tax in India and Nigeria is twice that of the U.S. and France as a proportion of their tax revenues.

A two per cent wealth tax on fortunes over $5 million and a five per cent tax on fortunes over $1 billion, per the report, could boost tax receipts by seven per cent in the U.S. and three per cent in France, compared to 14 per cent in India and seven per cent in Nigeria.

“For example, it is estimated that the revenue-raising potential of a wealth tax in India and Nigeria is twice that in the U.S. and France as a proportion of their tax revenues. A wealth tax of two per cent on fortunes above $5 million and five per cent on fortunes above $1bn could increase tax revenues by seven per cent in the U.S. and three per cent in France, compared with 14 per cent in India and seven per cent in Nigeria,” the report explained.

Given that Nigeria and India are home to one-third of the world’s population living in poverty, Oxfam suggested that the imposition of such a tax would positively impact the country as it could boost health expenditure in those two countries by 14 per cent and 33 per cent, respectively.

The report came as the Nigerian government keeps taking out loans to service the nation’s outrageously growing budget.

Last August, President Muhammadu Buhari’s regime said Nigeria would likely borrow to finance another budget deficit of N11.3 trillion in 2023, thereby taking the country’s debt stock to N50 trillion. 

When presenting the 2023 budget to the country’s parliament, Mr Buhari disclosed that the deficit would be paid for with new borrowings totalling N8.80 trillion, N206.18 billion from privatisation proceeds, and N1.77 trillion from drawdowns on bilateral and multilateral loans secured for specific development projects and programmes.