Despite the decision to increase the country’s tax-to-GDP ratio to 18 percent from 10.86%, the Federal Inland Revenue Service (FIRS) has reassured corporate organisations that this would not lead to increase in corporate taxes.
The Acting Chairman of the FIRS, Zacch Adedeji, who gave the assurance on Wednesday in Lagos allayed fears by corporate organisations that the new Tax-to-GDP rate would lead to increase in taxes or introduction of new taxes by the Federal Government.
Addressing representatives of top large tax-paying companies during a get-together in Lagos Adedeji said the President Bola Tinubu-led administration was determined to create a wholesome environment for businesses to flourish in the country.
He said the FIRS under his leadership would in the next three years achieve an eight percent raise in tax-to-GDP ratio to surpass Africa’s average of 16.5% without stifling investments or economic growth.
The plan, the Chairman said, had triggered muffled apprehensions among corporate entities that the decision could cause an increase in tax rates or introduction of new ones.
“Our belief, understanding and vision as a revenue-generating agency is not to introduce any new tax as we only want to use data to improve compliance,” he said.
Special Adviser to the Chairman on Media and Communication, Dare Adekanmbi, quoted the FIRS chairman as saying that the invited companies and those willing to voluntarily carry out their tax obligations had nothing to be afraid of.
“Our plan is simple. We want to grow tax revenue and we only want to tax prosperity and not poverty. Therefore, it is not in our interest to kill the trees that bear the fruits.
“My first ‘love letter’ to you is to appreciate what you have done. So, you don’t have anything to be afraid of.
“We will not collect what is not due to us. But we don’t want anyone not to pay what is due to us. Fair engagement is our plan. Rest assured that the 18% tax-to-GDP target will not translate to increase in taxes.
“If you have been listening to Mr Taiwo Oyedele who is the Chairman of the Presidential Committee on Fiscal Policy and Tax Reforms, you will have known that part of the mandate of the committee is to reduce the number of taxes,” the FIRS Chairman said.
The purpose of the engagement with the companies, he explained, was to factor their inputs into the strategic action plan being mapped out by the FIRS to address challenges hampering tax revenue collection.
He lauded the invited companies for their high sense of responsibility, urging them to continue to discharge their tax obligations diligently.
“I must also commend your commitment to upholding high tax compliance standards and responsible corporate citizenship, which sets you apart as the top taxpayers in Nigeria.
“This aligns perfectly with our vision of making taxation the pivot of national development through voluntary compliance. Your respective industries play a pivotal role in generating substantial tax revenue for government and in shaping economic and fiscal stability of the nation.
“We are not unmindful of the challenges facing businesses in Nigeria with the ongoing reforms to improve economic performance. These are painful but necessary choices we must make as a nation to attain our full potential,” he said.
The chairman, while responding to some of the concerns raised by representatives of the companies such as multiplicity of taxes, duplication of tax oversight on corporate entities, promised to address the issues raised.
Some of the companies at the event included Nestlé Nigeria Plc, ExxonMobil, Shell, Guinness, Nigerian Breweries Plc, Flour Mills, Dangote Group, MTN, British American Tobacco company, First Bank, Access Bank, Guaranty Trust Bank, Zenith Bank Plc, KC Gaming Limited (Bet9ja), Airtel, Seplat, BUA Cement, Nigeria Liquified Natural Gas, NNPC Limited, among others.