Cameroon: Enterprises are the umbilical cord of every country — Edison Ngeh tells participants at Nkafu Debate
January 25, 2020
By Boris Esono Nwenfor
Debaters, participants, Foretia team pose after the conclusion of the 4th Nkafu Debate in Yaounde, Cameroon
The fourth edition of the Nkafu debate has been organized with debaters arguing for and against the motion, “Will more taxes increase fiscal revenues in Cameroon? The debate organized by the Nkafu Policy Institute of the Denis and Lenora Foretia Foundation in partnership with Atlas Network at Mansel Hotel in Yaounde represent a platform par excellence for non-politicized debates, based on evidence, facts, and statistics.
The objective of these debate is to give Cameroonian and African high-level experts the opportunity to objectively address a set of issues related to our country’s economic development.
The debate panel constituted two experts arguing for the proposition and two against the proposition in a 90 minutes session. They defended their point of view based on facts, statistics, and experience. The debate focused on the best way for governments in Africa to increase fiscal revenues with a focus on Cameroon.
“Enterprises are the umbilical cord of every country. I encourage the government to review tax policies, consider a significant reduction in taxes, easy access to documentation, and tax centers, and a change in mentality of tax collectors”, Edison Ngeh, Tax consultant and Entrepreneur at EDOAN Consulting said in his arguments against.
Edison Ngeh says the government should review tax policies, consider a significant reduction in taxes, and a change in mentality of tax collectors
“The present situation of Cameroon keeps the country where there is a tax burden on tax payers already and if taxes are increased then more businesses will collapse.”
He added that in as much as taxes can bring revenue to the government, more taxes can actually kill businesses. He noted, “When you look at what the money is being used for, you find out that it is being embezzled, there is corruption, bad governance, and all of these will create unemployment and then poverty and low standard of living. What should be done is fight corruption, embezzlement rather than increase taxes.”
To Ndikombui Nigel, Auditor and Senior Tax expert at Goodwill Consulting arguing against increasing taxes, He said Tax payers should be educated on how taxes can conveniently not be a burden. “Also, increasing taxes will not raise government revenue, but rather discourage entrepreneurs from operating formally,” He said.
We need real tax education, and entrepreneurs need to understand that taxes are a citizen obligation. Also, taxes should be directed to their purpose and the state should not only depend on these taxes to raise revenue,” Marylyse Noussi, Jurist and Policy Analyst said in her arguments for.
"Taxes are a product, and we must sell the product to the contributors,” Alain Florentin Zouga, Associate Policy Researcher at the CPARC noted. “We are currently facing a lot of problems, and we need to develop our country. For that reason the state need to money, so they can finance the development of the country.”
“The state should increase taxes, but at the same time know that the environment should be safe so that contributors (entrepreneurs) can pay taxes. These taxes should not strangle the start-ups but should serve as a tool for development.”
Egoh Modi Aziz, Development Policy Analyst at the foundation said state agency should ensure transparency, accountability as per the taxes that they collect. “There should be sensitization — ensure that so many startups are sensitized, and they should also put in place the aspect of exoneration. They should make sure that the number of years is increased from two to three years so that new startups can be encouraged to grow their business, so they can take it from the informal to the formal sector,” He said.
Agathe Djomeghu, Directo of Programmes said the purpose of the Nkafu debate is a platform for non-politicized debates but based on facts, evidence and statistics
In Cameroon, taxation remains the first obstacle to the development of entrepreneurial activities (General Census of Enterprises, 2016). Indeed, high taxes prevent entrepreneurs to fully establish and flourish their activities. In addition, each year the government of Cameroon creates “new taxes.” For example, in 2019 Budget, a flat rate of 200 F CFA per application was created for software and application that is downloaded online via phone or tablet. Moreover, the 2020 Budget bills projects to increase taxes on cosmetics and artificial hair just to name but a few.
The above situation has led to the development, and the predominance of the informal sector in Cameroon. The majority of businesses prefer to remain informal (i.e. approximately 89% of small enterprises) to avoid being charged high taxes. Consequently, the government cannot fully collect the projected amounts.
