WHEN CONDOMS AND APHRODISIAC DOMINATE SHOPPING ITEMS

Written by Tom Obaseki.

Yes, Welcome to 2009. Yes, Most of us Pharmacists are usually always pushed to the peak of professional counselling during end of year celebrations. Christmas and New Year celebrations are supposed to be periods for stock taking and sober reflections. Unfortunately, it is now associated with high level of promiscuity, infidelity and unprecedented high level of sexual activities.

It is not unusual to find most Pharmacists overwhelmed with demand for condoms, aphrodisiacs and ‘Postinor-2.’

For the group of condom seekers and users, our problem is usually half solved as they already appreciate the challenges of sexuality and are already taking steps to practise safe Sex.

A new development that however characterised the last festivities was the strong demand for aphrodisiacs like never before. While the men wanted to boost their strength and power, the females were desperately seeking for medicinal enhancement to prove a point by satisfying their men in order to impress them.

But then, the highest professional counselling requirement was certainly from the group that used Postinor 2. Postinor 2 belongs to the class of emergency contraceptive indicated for people that engage in infrequent sexual intercourse to prevent pregnancy.

This group usually start turning out at the pharmacies from Christmas day after the merriment’ and revelling of the Christmas Eve. The demand for the contraceptive usually peaks on Boxing Day. Over the years this group have grown in number and is populated almost, by females of different age groups.

This year, the below 30years bracket seems to have taken the lead within this group on the demand spectrum. This is where the problem really lies. This group is made up of young girls who are sexually naive and their only fear in a relationship with the opposite sex is unwanted pregnancy.

The ever increasing number of this group suggests to us that the message of safe sex may just be hitting the rocks and not getting home.

Outside these sexuality group are those general fun seekers who over indulge in everything eatable with their mouths. They take every drink and eat every food available. Do you blame them? No, food and drinks are just in abundance. From afternoon on Christmas, they start trooping into pharmacies with complaints manifesting as indigestion and/or diarrhoea. Unfortunately, they are too quick to self medicate by asking for Flagyl Thalazole and Tetracycline when what they need is just an ant-diarrhoea. This is usually the time that most Pharmacies, run out of stock of Antacids and Andrews Liver salt.

What is the lesson for the season? It appears there is no better time and season to emphasis campaigns on sexuality, HIV/AIDS and STDs than the days leading to festivities like Christmas. Non Government Organisation, (NGO’s) and appropriate government and private agencies involved in projects in these areas will achieve so much success if such campaigns started in November and peaks toward the Christmas and New Year celebrations the effect would be better felt in the target group.

CHURCHES, MOSQUES, NGOs TO START PAYING TAXES FROM NEXT YEAR

The tax exemption status of religion based organizations and non government organisations are to be reviewed to align with international standards. This, according to a source in the Presidency, is to appropriately integrate otherwise tax exempt organizations into the taxable entities mainstream so as to drive the new impetus to fund the growth of the national economy from non oil revenue.

In line with this new thinking, the source informed that the Presidency has given its backing to the Nigeria Accounting Standard Board to evolve accounting standards that will serve as framework for tax exempt organizations to file their accounts and to be able to delineate which of their income is taxable from next year.

“The government does not intend to tax the income of churches, mosques or non-governmental organization or any other organization that naturally enjoys tax exemption status. The law is clear on the exemption status of such organizations. What the government has decided to do is to streamline income made in the furtherance of charitable activities of the tax exempt organizations and remove it from income made from what is known universally as unrelated business income,” the source said   

“So many religious organizations have, in fact, transformed into profit earning business enterprises and it is just proper that they are properly assessed for the purpose of taxation under the unrelated business income tax (UBIT),” the source argued. “These organizations are involved in various types of commercial activities, such as operating publishing houses, hotels, factories, radio and TV stations, parking lots, newspapers, bakeries, and restaurants. The Tax Reform will make income derived by churches from unrelated trade or business subject to tax.”

Another source at the Nigeria Accounting Standard Board argued the justification for taxing the unrelated business income of tax exempt organisations

The problem at which the tax on unrelated business income is directed is primarily that of unfair competition. The tax-free status of religion based organizations and NGOs enables them to use their profits tax-free to expand operations, while their competitors can expand only with the profits remaining after taxes. Also, a number of examples have arisen where these organizations have, in effect, used their tax exemptions to buy an ordinary business. That is, they have acquired the business with little or no investment on their own part and paid for it in instalments out of subsequent earnings – a procedure which usually could not be followed if the business were taxable. The idea is to impose the same tax on income derived from an unrelated trade or business as is borne by their competitors. It is, however, not intended that the tax imposed on unrelated business income will have any effect on the tax-exempt status of any organization,” the source explained.

The United States of America’s Internal Revenue Service Code, the template, which the NASB, is likely to adapt in its accounting standard to effect taxation of unrelated business income of affected organizations from next year, explains that churches and religious organizations, like other tax-exempt organizations, may engage in income-producing activities unrelated to their tax-exempt purposes, as long as the unrelated activities are not a substantial part of the organization’s activities. However, the net income from such activities will be subject to the UBIT if the following three conditions are met:

•                      the activity constitutes a trade or business,

•                      the trade or business is regularly carried on, and

•                      the trade or business is not substantially related to the organization’s exempt purpose. (The fact that the organization uses the income to further its charitable or religious purposes does not make the activity substantially related to its exempt purposes.)

 

Exceptions to Unrelated Business Income Tax

Even if an activity meets the above three criteria, the income may not be subject to tax if it meets one of the following exceptions: (a) substantially all of the work in operating the trade or business is performed by volunteers; (b) the activity is conducted by the organization primarily for the convenience of its members; or (c) the trade or business involves the selling of merchandise substantially all of which was donated.

In general, rents from real property, royalties, capital gains, and interest and dividends are not subject to the unrelated business income tax unless financed with borrowed money.

 

The code also provides examples of Unrelated Trade or Business Activities:  Unrelated trade or business activities vary depending on types of activities, as shown below.

Advertising

Many tax-exempt organizations sell advertising in their publications or other forms of public communication. Generally, income from the sale of advertising is unrelated trade or business income. This may include the sale of advertising space in weekly bulletins, magazines or journals, or on church or religious organization Web sites.

 

Sale of merchandise and publications

The sale of merchandise and publications (including the actual publication of materials) can be considered the conduct of an unrelated trade or business if the items involved do not have a substantial relationship to the exempt purposes of the organization.

 

 Rental income

Generally, income derived from the rental of real property and incidental personal property is excluded from unrelated business income. However, there are certain situations in which rental income may be unrelated business taxable income:

•                      if a church rents out property on which there is debt outstanding (for example, a mortgage note), the rental income may constitute unrelated debt-financed income subject to UBIT. (However, if a church or convention or association of churches acquires debt-financed land for use in its exempt purposes within 15 years of the time of acquisition, then income from the rental of the land may not constitute unrelated business income.),

•                      if personal services are rendered in connection with the rental, then the income may be unrelated business taxable income, or

•                      if a church charges for the use of the parking lot, the income may be unrelated business taxable income.

 

Parking lots

If a church owns a parking lot that is used by church members and visitors while attending church services, any parking fee paid to the church would not be subject to UBIT. However, if a church operates a parking lot that is used by members of the general public, parking fees would be taxable, as this activity would not be substantially related to the church’s exempt purpose, and parking fees are not treated as rent from real property. If the church enters into a lease with a third party who operates the church’s parking lot and pays rent to the church, such payments would not be subject to tax, as they would constitute rent from real property.

Whether an income-producing activity is an unrelated trade or business activity depends on all the facts and circumstances.