On Wednesday, Abia State Governor Alex Otti announced the suspension of all transport levies in the state, marking one of his boldest decisions as a governor.
Otti, who was sworn in on May 29, said the decision is based on his campaign promise to sanitize methods of revenue collection in the state. The governor said the suspension stays until an “organized” and “transparent” system of transport levy collection is introduced.
“In line with my campaign promise to sanitize methods of revenue collection in Abia, and stop all kinds of extortion, intimidation, and harassment of motorists, I have directed the immediate suspension of all kinds of Transport Levies payable to Abia state government and imposed on Tricycles, Buses, Taxis and other commercial vehicles plying Abia roads.
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“This suspension takes immediate effect and will remain until we review these levies and make public arrangements for the smooth, organized and transparent collection of such Transport Levies.
“In the light of the above decision, I have asked all those involved, directly and indirectly to please discontinue forthwith, or face the wrath of the law, as security agents have been briefed and directed to apprehend and bring to justice anyone found violating this directive,” he said.
The move marks a shift from Abia State’s preceding governors’ approach to transport levy collection in the state.
In Nigeria, non-state actors, under the aegis of the National Union of Road Transport Workers (NURTW) oversee the collection of transport levies, raking in millions of naira annually. This backdrop, which denies the state’s huge sums of revenue, has long been advocated to be dismantled.
However, the lack of political will by state governors has sustained the practice for a long time. Apart from Sheyi Makinde, the Oyo State governor, who in 2019 suspended the state’s NURTW and set up state-backed transport management, not many other governors have shown interest in blocking that area of state revenue leakage.
The reason has been largely linked to the relationship between state actors and members of the NURTW, who have been noted to be big actors in determining who governs the state during the elections. The resulting quid pro quo means that the governors of the states allow millions of naira generated from transport levies to go into the private pockets of non-state actors.
For instance, a 2001 report by the International Center for Investigative Journalism said that the NURTW generates about N123.08bn annually from levies it collects from transport operators in Lagos.
Such huge revenue is a big loss to broke state governments who have been repeatedly urged to abolish the transport union and set up state-backed transport management that will collect the levies on behalf of the government.
Oyo State’s Internal Generated Revenue (IGR) grew by more than 42% without the state increasing taxes in 2021, as a result of revenue coming in from the transport sector.
Otti’s move to create a sanitized transparent system for transport levy collection in Abia State is expected to yield results similar to that of Oyo State.