Lavish lifestyles of Nigerian public officials and citizens’ tax compliance

Many public officials in Nigeria genuinely work for the country’s and its citizens’ betterment. Sadly, they are in the minority. Those enamoured of profligate ostentatious displays with public funds are easily seen and seemingly dominate the space. But this behaviour creates significant socio-economic disparities that affect the way citizens may comply with their tax payment obligations. Seeing the riches of politicians and officials can be upsetting when many citizens are struggling with poverty. Like in any country, officials can vary widely in their behaviour, integrity, and commitment to public service. Unfortunately, it looks as if the public sector culture in Nigeria approves of lavish lifestyles. The first reason for this malaise is corruption. There is no doubt that Nigeria is a global leader in corruption, which also drives its mismanagement of public funds, diversion of public funds for personal gains, and lavish lifestyles. The second reason is the lack of accountability. Nigeria’s institutions are perennially weak, lacking substantial checks and balances that unfortunately create an environment where political leaders and public servants hardly face the consequences of their extravagant and wasteful behaviour in office. The third reason is the regrettably developing political culture of wastefulness. The prevailing political culture in Nigeria seemingly normalises and even encourages ostentatious displays of wealth among politicians and potentially as a way of gaining support and maintaining power.

Nigeria’s resentment for such a waste of public resources in luxurious profligacy was the ladder through which President Muhammadu Buhari accessed the presidency in 2015. The perception was that he lived an austere life and would bring that culture into the Nigerian public space. In fairness to him, he launched a few remarkable albeit largely undermined initiatives to control public resource wastage. Some of them include the treasury single account [TSA] for consolidating all government revenues into a single account held at the Central Bank of Nigeria. The TSA was to promote transparency, prevent revenue leakages and ensure better management of public funds, which underscored such illicit ostentation. The administration also launched a whistleblower policy to encourage individuals to report corruption and fraud in the public sector through protection incentives for individuals providing credible information for recovering stolen public funds. Thirdly, the administration also pursued several high-profile cases of corruption within the public sector and also continued to enforce the Fiscal Responsibility Act to promote prudent fiscal management and accountability of public finances. Despite all these efforts, the wastage of public funds on the lavish lifestyle of politicians and public officials continues to take a nauseating dimension.

Shortly after his swearing-in, President Bola Ahmed Tinubu removed the oil subsidy, leading to a 240 percent increase in fuel prices within his first 40 days in office. Despite the instant attendant hardship, he insensitively entertains Nigerians with insane displays of opulence. In one of his visits to Lagos state, vehicles in his convoy exceeded 124 making him the president with the longest motorcade in Nigeria’s history. The motorcade craze does not seem to have abated as Abuja witnesses a one-hour traffic gridlock each time he goes to or returns from work. This behaviour is more disheartening because the new administration encourages Nigerians to sacrifice and endure the pain. Many Nigerians no longer use their cars because they cannot fuel them. But it is not just the president who is addicted to this illicit obsession. Godswill Akpabio, the recently elected Senate President, also moves around in a stunning convoy comprising police motorcycle outriders, his official car among a retinue of other ultra luxury vehicles. State governors are also culpable. Usually, between nineteen and twenty-five vehicles are in the motorcade of some state governors on their way to work or to the airport.

Unarguably, the ostentatious lifestyle of public officials has a significant impact on citizens’ willingness to pay taxes. When public officials display extravagant lifestyles, it typically creates a perception of corruption, misuse of public funds, and a lack of accountability. This perception always erodes citizens’ trust in the government and a decreased willingness to contribute their hard-earned money as taxes. For instance, when public officials live luxurious lifestyles obviously beyond their means, suspicions about the source of their wealth which undermines the integrity of the government arise. It also creates a sense of injustice among taxpayers who believe that the government misuses their money for personal gain rather than the betterment of society. Such displays of opulence are also interpretable as a betrayal of the public’s trust and disregard for the financial struggles that many citizens face. As a result, taxpayers may feel resentful and less inclined to contribute their hard-earned money because government officials may not use them responsibly. Again, when public officials live extravagant lives without facing consequences or scrutiny, it sends a message that they are above the law and immune to any repercussions for their actions. This lack of accountability further erodes citizens’ trust in the government and creates a sense of powerlessness among taxpayers leading to them becoming less willing to fulfil their tax payment obligations.

The obscene, lavish lifestyles of Nigerian public officials are indicative of misplaced priorities. When elected or appointed to serve in public office, officials are to represent the best interests of their constituents and the public. This includes making decisions that benefit society, addressing pressing issues, and allocating resources wisely. However, a lavish lifestyle may suggest that these officials are more focused on personal gains and self-indulgence than on fulfilling their public duties. It creates an image of elitism and detachment from the realities and struggles of the people they supposedly serve. This behaviour can erode public trust and confidence in the government, leading to cynicism and apathy among citizens and elevated levels of non-compliance. For a properly functioning and just society, public officials must prioritise the needs of the people they serve. Transparency, accountability and a commitment to the common good are virtues that help in building trust with the public and in improving their compliance with tax payments.

Again, when public officials display opulence or engage in lavish displays of wealth, it can have several negative effects on their perception of the social contract and the relationship between citizens and the government. At an overly simplistic level, the Social Contract notion is an implicit agreement between citizens and their government, where citizens agree to relinquish some of their freedoms, including their earnings, and obey the laws [such as compliance with the tax laws] in exchange for protection, security, and the provision of public goods and services by the government. For instance, when officials seemingly use their positions for personal gain and extravagant lifestyles, it gives them away as not acting in the best interest of the public. Secondly, when public officials indulge in extravagance while basic public services are lacking or citizens are struggling, it creates a sense of betrayal and unmet expectations. Opulent displays can also indicate a strong disconnect of public officials from the realities and struggles faced by ordinary citizens. This leads to a lack of empathy and understanding, further widening the gap between the government and the governed and the evasion of tax payments. A perception of a broken or one-sided implementation of the social contract may make citizens question the authority of the government and may be less willing to comply with its laws and policies.

Additionally, a lavish public official lifestyle can erode the trust citizens have in their government. Trust is essential for a functioning tax system, as citizens need to believe in the judicious use of their tax contributions for the collective good. When citizens’ trust in government diminishes, tax compliance rates decrease. A strong positive correlation exists between trust in the government and its ability to use tax revenues responsibly and voluntary tax compliance. Citizens who believe that the government utilises their tax payments for their benefit, such as providing public services and infrastructure, and supporting social welfare programmes, are more likely to comply with tax laws. They see tax payments as a civic duty and contribution to the functioning of the society they believe in. Trust in the tax system also connects to the perception of fairness in taxation. If citizens believe that the tax system is fair, with an equitable distribution of tax burdens and benefits, they are more likely to comply willingly. On the other hand, a perception of corruption, favouritism, or unequal treatment exists in tax enforcement, it can erode trust and lead to reduced compliance.

Finally, among other possible solutions to tame the lavish lifestyle of public officials, three stand out. They are implementing stricter regulations around public officials’ spending, promoting transparency and accountability, and fostering a culture of public service. Stricter regulations may include a combination of spending caps, proper enforcement of asset disclosure requirements, and the establishment of clear guidelines on the acceptance of gifts, hospitality, or other forms of benefits. The promotion of transparency and accountability requires public officials to report income regularly, assets, liabilities, and expenses as part of a robust financial disclosure system. Proper enforcement of whistleblower protection through appropriate legislation safeguarding whistleblowers from retaliation and providing them with legal protection is important. Again, independent anti corruption agencies need to live up to their constitutional responsibilities in investigating and prosecuting cases of corruption involving public officials. Fostering a culture of public service includes the promotion of ethical behaviour, professionalism, and a sense of duty towards the public. Adequate training or sensitization on ethics for public officials can raise awareness about ethical standards, conflicts of interest and the importance of serving the public interest.