The organised labour in Kwara State has demanded the immediate reversal of the new tax regime imposed on workers in the state following the implementation of the new minimum wage of N70,000 for least paid employees in the public service.
The labour expressed dismay that the state government decided to effect a notorious percentage on tax deductible from workers’ salaries contrary to the negotiation it had with the government for tax relief for workers upon the payment of the new minimum wage.
Rising from a joint State Administrative Council (SAC) meeting of the Nigeria Labour Congress (NLC) and Trade Union Congress (TUC) in Ilorin on Friday, the labour leaders, in a joint statement, called for a downward review of the tax percentage on salaries of workers in the state.
Those who signed the statement include state NLC Chairman, Comrade Muritala Saheed Olayinka; his TUC counterpart, Comrade Olayinka Onikijipa; state Chairman, Coalition of Health Workers Union (COHESU), Comrade Isaac Bolatito; and state Chairman and Secretary, Joint Negotiation Council (JNC), Comrade Saliu Suleiman and Comrade Tunde Joseph respectively.
The organized labour lamented the refusal of the state government to implement the new minimum wage of N70,000 for pensioners in the state.
It urged the state government to grant tax holiday to workers on the consequential adjustment of the new minimum wage of N70,000 for 12 months to serve as succour for them.
The joint labour congress asked the state government to swiftly act on the demand of the labour to avert industrial disharmony.
“The SAC of Joint Labour Centres met today to review the outcome of the new minimum wage payment to Kwara workers as approved by His Excellency, Governor AbdulRahman AbdulRazaq. The committee observed with dismay the notorious percentage tax deducted from our members.
“This was at variance with government/labour discussion at the negotiation table for tax relief on added sum or status quo ante on the percentage tax deduction.
“In view of the above, the committee resolved that government should grant tax holiday to Kwara State workers on the added sum for at least 12 months to serve as succour for workers in the state, and to review downward the tax percentage on workers salary.
However, in a statement by the acting head, Corporate Affairs Department of the Kwara state Internal Revenue Service (KWIRS),
Funmilola Oguntunbi, she said that the minimum wage implementation and statutory deductions are in accordance with legal obligations, adding that the gross income of workers is subject to statutory deductions, including Personal Income Tax, pension contributions, National Health Insurance SSchemes(NHIS), National Housing Fund (NHF), and insurance, where applicable.
The KWIRS official, who said that, “historically, the non-compliance with these statutory provisions in the State has had various consequences, including impacts on employees”, added that the inconsistency in tax deductions by MDAs has led to under-remittance of PAYE, affecting both the state’s revenue for developmental projects and employees’ personal obligations.
“As a result of these long-standing compliance issues, the state has accumulated a PAYE liability exceeding N4 billion from 2010 to 2023, largely due to the use of an incorrect tax table. This has positioned Kwara 18th in the 2023 PAYE ranking, despite the state’s strong performance in other IGR areas.
She said that the state government remains dedicated to both employee welfare and fiscal responsibility, fostering effective tax administration for sustainable development.
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