Revenue Agents: a Growing Menace

Money Palaver

The author

By George Eze Emeghara

Last week two videos went viral. One showed a poultry farmer who lost newly hatched chicks valued at about two million Naira because the commercial vehicle he hired to go and collect the chicks was impounded by some revenue collecting thugs and agents for not having the correct ” emblem”.They took the vehicle and its cargo to a police station and left them in the hot sun.

By the time they sorted things out and returned, most of the chicks had died. Another video showed some people who claimed to be “Local Government officials” molesting a motorist over the waste basket in his car.

The issue was not that he didn’t have basket in his vehicle, it was that the one he had was from a neighbouring state and it was not acceptable to them. They insisted that he must purchase their own.

Sometime ago, I visited a friend in his office. I met some commotion there. A man was shouting and insisting that he must arrest my friend and his staff. He had some rough looking men with him and two armed policemen. What was the problem?

A few days earlier, he had dropped a demand notice for one charge or the other, purportedly from the Local Government council in charge of the area. My friend thought the amount being demanded was a bit too high and sent someone to go to the Local Government office and find out what the exact charge was.

Oil revenue dwindling.

He discovered that it was much less than what was on the Demand notice they had received. He paid the money to the Local Government directly and collected a receipt.

When the man who was screaming came with his team to collect money, he was shown the receipt indicating that the money had been paid to the Local Government. He didn’t take it well.But after a lot of huffing and puffing he left empty handed.

These three incidents illustrate some of the unsavoury consequences of the current trend of privatising revenue collection by various levels of government in the country.

It is not a secret anymore that things are no longer so easy for governments. Cash is tight. As a result they can no longer dispense patronage by way of contracts the way they did in the past. Only the incurable optimists or those who are very well connected apply for such contracts these days.

Many contractors are owed indefinitely and some of them have been ruined in the process.Even the so called well connected ones run a risk by executing such contracts. If they are not paid before the man who gave them the job leaves office, his successor is not likely to listen to their pleas for payment.
If he deigns to have any discussions with them, it is to discuss ” terms” of payment.

The terms here refer to the percentage of the total contract sum that the contractor is willing to part with to get paid. Due to dwindling contracts and non-payment for jobs done, contractors are disappearing from the picture.

They have been replaced by Revenue agents or Consultants. These are people who are appointed by government to collect revenue on their behalf.

As with the contractors, these agents are usually connected to the powers that be. Some of them buy the “agency” or licence to collect revenue by paying a lump sum to the government in question after which they are given the authority to harass members of the public for money.

This is what those selling the emblems and waste baskets in the videos described above are likely to have done. There are those who convinced the government that they can boost their revenue from point one to point two each month and for any extra revenue they generate a hefty percentage comes to them. Usually, a sum is chosen as a benchmark above which anything they collect is their own.

Unfortunately most times, in setting this benchmark, the governments go below what they had been receiving, so the contractor gets money for doing nothing. Your guess is as good as mine as to what happens to that money.

Some ministries and agencies also have their own ” in house” revenue collection gangs usually made up of staff, some ruffians, and a gun totting security operative harassing people to pay up for one thing or the other. Unsurprisingly, very little of the money such teams collect finds its way into government coffers.

These agents, consultants and what have you are illegal. There are rules about who should collect revenue for government in the Civil service regulations. No private person can collect revenue for government according to the rules.

Under this system of engaging outsiders to collect revenue, the governments are being shortchanged on many fronts. The agent inflates the amount to be paid for whatever tax or rate he is supposed to collect.
When he gets the money, he remits a small percentage of it to the government. On the little he has remitted, he still collects the agreed percentage.

His crude, vicious and uncompromising methods, in addition to the inflated taxes they demand and collect by strong-arm methods, all add up to creating very a poor image of the government in the eyes of the governed. It also builds resentment against the government.

Businesses complain of multiple levies.

The use of consultants and agents also worsens the unemployment situation. Young school leavers can be recruited, offered lifetime or permanent employment and trained to do the jobs these consultants and agents are doing as was the case in the past. By so doing, government will be killing many birds with one stone.

They would be providing employment to some of the army of unemployed people in their states.
They would be boosting their income or revenue as the money that was going to these agents under various guises would now be retained by the government. These new Government employees will not be as desperate, callous and inhumane as the revenue agents and consultants in carrying out their duties because they would have been well trained and they will be supervised. This will also go a long way in generating a positive public image for the government in question.

However considering how lucrative farming out revenue collection to private persons can be for all concerned, except the poor tax payer, it appears this obnoxious practice will be with us for a while.