The Nigeria Labour Congress has called for an amendment to the income tax law so that the new minimum wage of N30,000 will fall below taxable income.
The National Union of Textile Garment and Tailoring Workers of Nigeria at the plenary session of the 12th delegates conference of the NLC in Abuja on Wednesday said there was a ‘twin assault on the real income of Nigerian workers caused by the devaluation of the naira and high inflation rates.”
The NUTGTWN also expressed concern that the process of the new minimum wage was taking too long, calling on the NLC to intervene.
While appealing for the protection of the new minimum wage, the General Secretary of NLC, Peter Ozo-Eson, said the income tax law needed to be amended to defend workers’ purchasing power.
Ozo-Eson said, “Given that the N30,000 we agreed on as a compromised minimum wage is so low, ideally, it should not be taxed, but I believe that the correct way to do it is to amend the income tax law to raise the exemption bar if the N30,000 will fall within.
“The law should be amended to ensure that the minimum wage level is below taxable income.
“Under the present law, if you earn N18,000 a month, your tax is zero. There is a tax table but with N30,000, under the existing exemption guideline, there will be some little tax, because it will be slightly above the exemption tax.
“What needs to be done is to have an adjustment to the schedule so that the exemption is placed above the minimum wage.”
The General Secretary of the of NUTGTWN, Issa Aremu, who is also the governorship candidate of Labour Party in Kwara State, said labour should pressure the Federal Inland Revenue Service to raise the tax bar in such a way that the N30,000 minimum wage would fall below taxable income.
He also called for tax holiday for some categories of workers.
Aremu said, “Now that we have raised the minimum wage to N30,000, we must impress it on the FIRS to raise tax bar so that the new minimum wage would be protected.
“If you tax the minimum wage of N30,000, we may as well go back to N25,000 or N27,000 by default.
“The Deputy Speaker of the House of Representatives raised the point and I think labour must push the agenda to protect the new minimum wage.
“The N30,000 new minimum wage is actually a compromised amount from the N56,000 earlier proposed, so it must be protected.
“If the Federal Government can give a 10-year tax holiday to companies, why not give the same to workers?”