Rivers State earns N55bn from transport tax but less than 1% goes into government purse

IN the southern Nigerian state of Rivers, road tax is collected by non-state actors. And these individuals pocket nearly everything.

This investigation reveals for the first time that Rivers State generates a minimum of N55.234 billion ($34.20 million) from 62,418 commercial vehicles, 24,432 tricycles and 10, 892 motorcycles in road taxes every year.

A set of receipts issued to tricycle operators at Obio-Akpor Local Government Area

Incidentally, only 0.41 percent of the money goes into the government coffers, according to this data-driven investigation. A large chunk of the tax goes into the accounts of a transport union and its members, while part of it is appropriated by community touts.

A receipt issued by NURTW to tricycle operators at Trailer Park, Eleme

A small percentage of the tax is kept by a private company owned by three persons from the same family.

READ ALSO: https://www.economypost.ng/featured/lagos-records-zero-revenue-from-road-taxes-agberos-pocket-n123bn/2023/11/14/

Road tax in the state is paid by drivers of commercial buses, and tricycles, also known as “Keke Marwa.” Some of it is paid by motorcyclists, also known in local parlance as “Okada.” 

In 2022, Rivers, Nigeria’s second richest state, reported N223.93 million in road tax, but this amount is only a drop in the pan as much of what is realised is diverted to private accounts.

The numbers, the methodology

No relevant government or non-governmental institution contacted by the reporter prior to this investigation agreed to be in possession of data on the number of vehicles, tricycles and motorcycles in Rivers State.

The reporter therefore went undercover to unravel these numbers.

Agberos collecting different transport taxes from a commercial vehicle driver at Trailer Park, Eleme

Posing as a researcher, the reporter spoke with 24 officials of the National Union of Road Transport

(NURTW) in nine local governments of the state for the purpose of estimating the numbers. 

READ ALSO: https://www.economypost.ng/featured/how-tough-environment-sent-over-100-nigerian-factories-out-of-business/2023/11/13/

The local governments are: Port Harcourt, Obio-Akpor, Ahaoda East, Eleme, Ikwerre, Oyigbo, Gokana, Khana and Tai. 

In Obio-Akpor, the reporter covered areas such as Rumokoro-Rumuodara- Eliozu-New Road- Artillery -Woji axes and their surroundings.

Agberos encircle a tricyclist at Rumuodara to collect tax

In Ikwerre, the reporter crisscrossed Omagwa, Isiokpo, Igwuruta and Ubima.

In Port Harcourt Local Government, the reporter went round Diobu, D-Line, Agip, and Amadi Ama.

In Eleme axis, Eleme Junction, Akpajo Bus Stop and Trailer Park were covered.

In Gokana Local Government Area, places like Bere, Mogho, Kpor and Bodo were visited.

In Khana Local Government Area, Bori Park, Deken and Baghayagbe were covered.

In Tai, Nonwa, Borobara, Korokoro and Gio were covered. 

Also, Elele and Ahoada town in Ahaoda East were visited.

In Oyigbo axis, Oyigbo, and Asa were covered.

Touts at Rumuodomaya, Obio-Akpor Local Government Area

Based on the different estimates by the NURTW officials, the total number of vehicles in Rivers State sums up to 62, 418.

The same method was used for tricycles, with the heaviest number of tricycles (5, 254) seen around Rumokoro (Obio Akpor Local Government Area). The number of tricycles was 2,570 at Eleme axis, 3,352 at Elele-Ahaoda axis, and 2,856 at Oyigbo area.

READ ALSO: https://www.economypost.ng/business/kaduna-based-steel-agency-fails-to-justify-n12bn-allocation-by-buhari-gov/2023/11/09/

Only Ikwerre Local Government Area was omitted in this category, as tricycles were recently banned in the council.

It was found that the total number of tricycles in Rivers State was 24,432.

Bori Park, headquarters of NURTW in Khana, Gokana and Tai local government areas

Similarly, bikes are not allowed in city centres in Rivers State. With the same methodology used in places where they are allowed such as Ikwerre, Ahaoada, among others, the total number of bikes was found to be 10,892.

Money in the bag

What does this mean in naira and kobo? To be sure of this, the reporter went directly to vehicle drivers, tricyclists and motorcyclists to find out what they pay as road tax each day. Twenty-seven commercial vehicle drivers, tricyclists and motorcyclists were interviewed in the nine local government areas for this story.

Based on the findings, the average amount spent by commercial vehicles in Rivers State is N1,800 daily, summing up to N41.121 billion a year when multiplied by 62,418 vehicles.

Based on the number of commercial vehicles in Rivers State (62,418) and what is being collected from them yearly (N100 daily x 366), the Rivers State Internal Revenue Service (RIRS) should be able to get N2.284 billion from commercial vehicles annually. However, this is not the case as the RIRS reported N223.93 million only in road tax in 2022.

Similarly, tricycles pay an average of N1,400, amounting to N12.519 billion annually when multiplied by 24,432 tricycles.  

Based on the number of tricycles in the state (24,432) and what is collected annually (N100 x 366), the RIRS should easily get N894.211 million annually from tricycles. However, this amount is far less than what Rivers State government declared as tax collected from tricycles, commercial vehicles and motorcycles in 2022 (N223.93 million).

Motorcyclists operating at Elele Alimin in Ikwerre Local Government Area

For the 10, 892 commercial motorcycles, each of them averagely pays N400 daily, amounting to N1.594 billion annually. Based on the number of motorcycles in the state (10,892) and what is collected annually (N100 x 366), the RIRS should easily receive N389.647 million as revenue from motorcycles in places where they are allowed. But this is not the case as the state said it received N223.93 million as tax from motorcycles, commercial vehicles and tricycles in 2022.

READ ALSO: https://www.economypost.ng/featured/nigerian-smes-pay-over-100-taxes-but-some-of-them-go-into-personal-pockets/2023/12/07/

ItemNumberAnnual Revenue
Bikes10,892N1.594 bn
Data on vehicles in Rivers State

Source: ICIR, Economy Post

“We make a lot of money each day. Sometimes, I go home with over N10,000 from my ‘pit’,” said one of the NURTW members at Choba.

The word “pit” signifies an area that has been allocated to a revenue tout for the purpose of collecting transport tax.

Agbero trying to collect transport tax from a tricyclist at Rumuodara

Who takes Rivers State tax?

The first group that takes a large chunk of Rivers State’s road tax is the National Union of Road Transport Workers (NURTW), which is notorious for under-reporting transport tax collections across Nigeria.

They collect the tax as cash from commercial drivers and cyclists but report only a fraction of it.

The reporter caught many of them in camera collecting the public tax in cash without issuing receipts. In Rivers State transport receipts are issued by different institutions such as RIRS, NURTW, and local governments.

It was discovered that drivers who refuse to pay are beaten or have their vehicles, tricycles or motorcycles confiscated.

Touts operating at Rumuokoro in Obio Akpor

The reporter found that communities in Greater Port Harcourt such as Obio-Akpor, Port Harcourt, Eleme and Oyigbo collect the road tax in one way or the other through villagers and touts.

“Rivers State has deliberately failed to embrace technology by asking that the road tax be paid electronically through numerous online platforms available today or via the bank,” said a United Kingdom-based economist, Dr Ikechukwu Obiefuna.

READ ALSO: https://www.economypost.ng/featured/exclusive-fubara-eyes-obaseki-strategy-for-27-lawmakers-as-rivers-economy-struggles/2023/12/11/

“Collecting tax in cash breeds corruption and wastages,” he noted.

Apart from what is paid each day by a motorist, NURTW and touts also charge new entrants registration fees ranging from N7,000 to N20,000.

The reporter posed as a new entrant into the commercial motorcycle business at Bori. Chairman of the NURTW in charge of tricycles and motorcycles, Mr Christian Nubor, asked him to pay N8,000 per motorcycle for registration.

De-Jonny West Africa, millionaire tax collector

A company known as De-Jonny West Africa Limited collects N100 from every tricyclist around Obio-Akpor Local Government and issues a receipt for that. With 5,254 tricycles at Rumuodara, the company may be making N192.296 million annually.

With a beneficial ownership analysis at the Corporate Affairs Commission (CAC), which is Nigeria’s companies’ registrar, the reporter found persons with significant control of the firm to include: Onukem Ovundah, Onukem Temple, and Onukem Enyinda – three individuals from the same family.

Enyinda Onukem was the traditional prime minister of Okporo, one of the communities in Obio-Akpor Local Government Area. Checks showed that he was expelled by Okporo Supreme Traditional Rulers, Chiefs and the Elders Council in 2016, though the suspension was later lifted.   He wielded enormous influence in Rivers State, such that the former governor of Rivers State, Mr Nyesom Wike, sent his Chief of Staff, Engr Emeka Woke, to condole with him when he lost his wife, Ms Joy Adi Enyinda Onukem, in 2016.

However, our reporter was told that Enyinda Onukem is no longer alive.

Onukem Temple was the zonal leader of Rivers State Task Force on Street Trading, Illegal Motor Parks and Markets. He was in charge of Oil Mill/Artillery Zone of Port Harcourt but was suspended on October 28, 2019, for “acts of sabotage and compromise.”

The Tide News Online quoted the Coordinator of the Task Force, Mr Bright Amaewhule, as saying, “I got information on the Zonal leader of the Oil Mill/Artillery Zone, one Temple Onukem that he has collected money from the traders to allow them trade on the pedestrian (walk way) and the Aba Road axis of Elelenwo and Rumuokurusi.

“That was now affecting vehicular and human movements. I called him severally, he never picked my calls. I had to mobilise my own special team to that place.”

Temple, Enyinda and Ovundah are also owners of De-Jonny Blue Hotels at Rumuodara, Rivers State.

However, our reporter was told that Temple Onukem has also died.

“This is extortion. He has no power to collect such tax except if the state government gave him that as a contract. Anything other than that is extortion,” said a human rights lawyer, Dr Sam Oyigbo.

Onukem family refused to speak

With the deaths of Enyinda and Temple Onukem, the eldest brother, Mr Kingsley Onukem, is currently managing De-Jonny West Africa. Unwilling to speak about the issue when contacted by phone, our reporter visited Mr Kingsley Onukem’s home at Rumuodara twice.

The first visit was fruitless because he was not available to speak. On the second visit, our reporter, who was told to wait for Mr Kingsley Onukem in the sitting room, was later informed that he had left home.

READ ALSO: https://www.economypost.ng/business/industry-ministry-to-waste-n1bn-for-another-investment-survey-n500m-on-road-shows/2023/12/26/

State government keeps mute

Special Assistant to Rivers State Governor on Media , Mr Boniface Onyedi, did not speak on the issue as he said it did not fall within his remit.

Similarly, Commissioner for Information, Mr Joe Johnson, was asked to provide an explanation as to whether the government authorised De-Jonny West Africa to collect the road tax on its behalf and how much the company was remitting to the state coffers.

He referred the reporter to the transport commissioner.

When the reporter called Commissioner for Transport, Dr Jacobson Mbina, he did not pick several calls put to him on different occasions.

He also did not reply to text messages sent to him regarding De-Jonny and how transport taxes are collected in the state.

One of our reporters visited the Rivers State Internal Revenue Service (RIRS) to get answers as to how much the NURTW pays into the state coffers and how the money is shared, but its Chairman, Mr Chibeoso Aholu, did not speak to her.  One of his assistants said he would not be able to provide answers to the questions.

Transport costs rising

Drivers told the reporter that one of the reasons for the rise in transport costs in the state is the charges imposed by touts.

At Rumokoro Motor Park, a driver moving to Ahaoda charges N1,500 per passenger but also pays N1,500 to the NURTW.

No matter where the vehicle is headed to, the driver must pay NURTW what is collected in fare from one passenger.

“I am moving with eight passengers. I am going to buy fuel at almost N700 per litre, pay N100 at each of about 10 checkpoints and still pay ‘agberos’ at the park,” the driver said.

“If my vehicle stops for a passenger to set down, I will also pay agberos. Tell me why transport fares will not be high,” he lamented.

At Trailer Park, a passenger, who identified herself simply as Agnes Wokoma, said she used to spend N300 from Eleme to Gokana but had to pay N600 now.

Touts hanging at Rumuokoro highway

“It is not only caused by the rising cost of fuel but also the increasing number of harassments faced by drivers along the road. Police and touts are raising our transport fares,” said Ms Wokoma.

Rivers State IGR vs debt

In terms of internally generated revenue (IGR), Rivers is Nigeria’s second richest state after Lagos.

Rivers State earned N169.600 billion as internally generated revenue (IGR) in 2019, N117.190 billion in 2020 and N123.348 billion in 2021, according to the National Bureau of Statistics (NBS). It generated N172.823 billion in 2022 as its IGR.

However, its road tax in 2022 was only N223.93 million, which is just a scratch on the surface.  

READ ALSO: https://www.economypost.ng/featured/inside-the-dubious-2024-budget-of-ministry-of-youth-development/2024/01/15/

If Rivers State branch of the NURTW were to be a state, it would be the 10th richest state in terms of IGR, richer than 26 other states, including Kwara (N35.76bn), Akwa Ibom (N34.81bn), Anambra (N33.97bn), Ondo (N32.64bn), and Enugu (N28.69bn).

In terms of debt, Rivers State’s domestic debt stood at N225.505 billion as at June 30, 2023, according to the Debt Management Office (DMO).

Only domestic debts of Lagos, Delta, and Ogun were higher.

Rivers State’s external debt stood at  $83.955 million as at June 30, 2023, higher than most, except 13 states.

Rivers is one of the 28 states that failed to attract foreign investments in the first half of 2023, according to the NBS.

Rivers State unemployment rate stood at 41.59 percent in 2020, according to the NBS. Rivers State has a population of 5.49 million people, according to the World Population Review and the National Population Commission.

Tricycles operating Elele-Oyigbo axis

With 41.59 percent of the population unemployed, it means that 3.12 million Rivers State residents are out of job.

Other states with very high unemployment rates are Adamawa (54.89 percent ) and Cross River (53.65 percent), according to the NBS.

Nyesom Wike, now Minister of the Federal Capital territory, FCT, which is politically regarded as Nigeria’s 37th state, was governor of the state at this time.

What can N40.362bn can do for Rivers?

With N360,000 minimum wage for one year per person, the N40.362 billion road tax can pay the minimum wages of 112, 116 Rivers State unemployed citizens for one year.

If the state government decides to build standard secondary schools with 200 million each, it could set up 202 schools across the state.

We are remitting into govt coffers, says NURTW

The NURTW has, however, said that it was remitting duly to the state government treasury.

A board member of NURTW and Secretary of Park Maintenance Committee in Rivers State set up by the state government, Mr Comrade Ejims Alikwo, said the union was not stealing government revenues.

“We pay every week to the government,” he said.

“We do not remit everything because part of the money is used for the payment of the union members’ salaries,” he said.

When pressed on how much the union collects and the sharing formula between the state government and the NURTW, Comrade Alikwo said he did not have all the details.

He claimed that the union not only oversaw the welfare of drivers but also ensured that passengers’ lives were not endangered by drunken drivers.   

The way forward

Tax experts want a change in tax administration in Rivers State, calling for the digitization of the processes to achieve transparency.

Associate Researcher at African Centre for Tax and Governance, Mr Timothy Usman, said automation was the only way the state could reverse the situation.

“When a local government in Dakar, Senegal, wanted to collect a tax from cyclists, the officials sat down with them on what they wanted the money to be used for.

“We can replicate that here. But more importantly, automation of the process is the way to go. People need to pay the road tax on smart payment platforms that are available.

“However, there is a need for a political buy-in for automation to work,” he said.

READ ALSO: https://www.economypost.ng/featured/for-shutting-down-economy-4-times-in-january-south-east-nigeria-loses-n355bn/2024/01/22/

A tax expert and accountant, Mr Olalekan Saidi, said education and enlightenment were critical in changing the situation.

“Before you automate the system, people must understand the flow- – who should collect what. Also, somebody should be monitoring to ensure that it works,” he noted.

An economist, Ms Janet Obiorah, said people in Rivers State government were merely using a public tax to compensate their political thugs.

“If you think that the Rivers State government does not know that its revenue is being diverted by touts, you are mistaken,” she said.

“This is a way to empower those that will be used as thugs during elections. We have not forgotten what happened during the 2023 general elections. Also, it is a way to compensate those who supported them during elections. It is the usual practice across the states, not just Rivers,” she added.

This story was funded by the National Endowment for Democracy (NED) and the International Centre for Investigative Reporting (ICIR).

+ posts


Please enter your comment!
Please enter your name here


The Ultimate Managed Hosting Platform
Load WooCommerce Stores in 249ms!

More like this