Following what many have described as multiple and excessive taxations in Enugu State, businesses are leaving in droves, and relocating to neighbouring states like Anambra, Abia, and Kogi States.
Investigations reveal that while small businesses are shutting down under the difficult tax regime worsened by the unfavourable national economic climate, those sizeable enough to move are moving their operational bases to other states.
Our investigation reveals that state government agents have been empowered to operate everywhere in the supply chain, from factories and warehouses, through delivery routes, to market destinations, demanding all sorts of receipted and unreceipted taxes and fees from businesses.
According to those interviewed, this is worsening the rate of unemployment in the state as employers of labour have been sending away their staff after shutting down and leaving the state.
A businessman in Enugu who spoke on the condition of anonymity bemoaned the crippling tax regime in the state and said he was moving the headquarters of his business to Awka in Anambra State.
The entrepreneur, who plays in the oil & gas sector and employs 28 people said it had become impossible to continue to run his business because of the multiple taxation regime of the Governor Peter Mbah administration.
He lamented that following his relocation, he had to send away his employees, some of whom have been with him for nine years, but said he was left with little choices.
“In an industry where the margins are thin, the best a business needs to do to survive is to explore other means of survival if the operating environment becomes very unfriendly, and that is what we have had to face in Enugu. I have discovered that it was better for me to move my business to Anambra State and supply from there to customers in Enugu than to continue operating from here. The system here is so unfriendly and just as multinationals such as GlaxoSmithKline and Procter & Gamble closed their Nigerian operations, we local players are also being forced to rationalize our businesses based on certain critical subnational considerations,” he stated.
The man, who claimed his annual turnover is more than $2 million (N300 million), lamented that players in their industry pay multiple times for a truck-load of product, said it is not sustainable.
He said he is aware that many of his friends are making similar plans of leaving the state for other states like Abia, Kogi, Benue, and Ebonyi States, and urged the state governor to re-evaluate his policies on tax to retain businesses in the state and encourage the inflow of new ones.
“When you are loading your trucks from the warehouses and factories in Enugu, the state tax agents will appear. As you are moving along the road, some others will show up, and even when you are transloading the same product to another truck, these men will show up. When you arrive at the place you want to offload, you still see them. When you calculate all these and add to other taxes demanded by the government you just have two choices which include remaining here and facing business failure of moving to other relatively more business-friendly locations outside the state. Remember that ESWAMA has increased its bills for waste management. The same thing has happened at the truck parks and warehouses and we are not even talking about the other taxes paid to the State. No businessman that has not been subsidized by the state government will survive these conditions,” he continued.