Business - Business & Economy - Health - July 14, 2021

Tax, other non-oil revenues sustaining monthly FAAC allocations – FIRS Chairman

MEDIATRACNET

Both tax payers and revenue collection agencies must continue to work together to sustain the new role tax and other non-oil revenue sources are playing in the Nigerian economy.
Since the beginning of the dwindling of oil revenues as a result of the impact of coronavirus pandemic on the international crude oil market, the Chairman of the Federal Inland Revenue Service (FIRS), Muhammad Nami, said on Wednesday that Nigeria’s economy has continued to rely on non-oil revenues to discharge its statutory responsibilities to the Federation.
Nami spoke in Kano  at a stakeholders meeting between FIRS Management and Staff and the Kano Business Community,  said today, Nigerians rely on non-oil revenues to pay workers’ salaries and provide social amenities to the citizenry. 
“Presently, Nigeria’s economy has continued to rely on non-oil revenues to discharge its statutory responsibilities of paying workers salaries and provide social amenities to the citizenry,” Nami said.
He however lamented that despite the prospects which tax revenue holds for the country, the “Tax-to-GDP (gross domestic product) ratio for Nigeria was about 6 percent  compared to Egypt at 15percent, Ghana and Kenya at 17 percent, South Africa at 28 percent. This is a very sad reality that is unacceptable for a country that has the largest economy in Africa,” the FIRS Chairman said.
“To overcome this challenge, we must recognise and adapt to the changing pattern of the business environment where technology is the driver of business operations.  “For many years, our revenue generation architecture had been largely manual with limited use of technology.
“Adopting technology in tax administration is crucial in improving domestic revenue mobilization given dwindling oil prices to avoid falling into a debt crisis,” he said.
Nami said it was against this backdrop that the TaxProMax became the channel for filing Naira-denominated tax returns effective from June 7, 2021.
The TaxProMax platfroon, he said, enables seamless registration, filing, payment of taxes and automatic credit of withholding tax as well as other credits to the Taxpayer’s accounts among other features.
The TaxProMax platform also provides a single view to Taxpayers for all transactions with the Service.
“It will interest you to know that the Service collected over N650 billion in June 2021. This feat was achieved as a result of the efficiency and effectiveness of the TaxProMax Solution.”
Another groundbreaking development by the FIRS under his administration, Nami said, is the introduction of the court-backed “FIRS Practice Direction”, another innovation introduced to aid revenue generation by cutting down on needless litigation which slows down revenue collection.”
The other advantages of the FIRS Practice Direction on tax revenue generation, he said, is that cases involving FIRS would be given accelerated hearing and priority attention in the Federal High Court.
In addition, he said the system would also enable the FIRS to obtain Order of the Court for forfeiture of immovable property of taxpayers, freezing of bank accounts, access to books, servers, billing systems.
In addition, he said the system would fast-track the recovery of tax debts by civil action; increases tax compliance, and the collection of revenue to the government.”
Also, Nami disclosed that the National Tax Policy Implementation Document had prioritised the assessment and collection of indirect taxes in Nigeria, as they are difficult to dodge, easy to pay and easy to administer.
He, therefore, enjoined members of staff at the FIRS to put the policy document to good use in their tax collection processes.
The Executive Chairman listed the various challenges associated with tax collection in the country to include that “when companies collect taxes as collection agents of Value-Added Tax (VAT) for instance, they do not remit as and when due.
In some cases, they do not remit it at all,” the Chairman said.
He, therefore, appealed to defaulting corporate organisations to turn a new leaf and remit VAT and other taxes as and when due.
He stressed that the consequences of non-remittances under extant tax laws in the country are severe, which corporate executives would not wish to experience.

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