The Federal Inland Revenue Service (FIRS) rolled out the drums in a little show of self-adulation ver its performance with the announcement on Monday of its achievement of the highest tax revenue collection in its history.
In presenting its “FIRS 2022 Performance Update,” report after his briefing President Muhammadu Buhari in Abuja, the Chairman of the Service, Muhammad Nami, said the Service exceeded its 2021 performance by recording over N10.1 trillion in tax revenue in 2022.
“The FIRS, in the year 2022 collected a total of N10.1 trillion in both oil (N4.09 trillion) and non-oil (N5.96 trillion) revenues as against a target of N10.44 trillion.
“Companies Income Tax contributed N2.83 trillion; Value Added Tax N2.51 trillion; Electronic Money Transfer Levy N125.67 billion and Earmarked Taxes N353.69 billion.
“Non-oil taxes contributed 59% of the total collection in the year, while oil tax collection stood at 41% of total collection,” the report noted.
Nami noted that the 2022 performance was the first time the FIRS would cross the N10 trillion revenue collection threshold in its annual history.
He said further clarification from the Performance Update Report showed that the total revenue collection included about N146.27 billion as the total value of certificates issued by the Service to private investors and the Nigerian National Petroleum Company (NNPC) Limited for road infrastructure development under the Road Infrastructure Development Refurbishment Investment Tax Credit Scheme created by Executive Order No. 007 of 2019.
Also, the report said the N10.1 trillion was exclusive of tax waivers on account granted different corporate entities through various tax incentives under the respective laws, totalling over N1.805 trillion.
The performance, Nami pointed out, was benchmarked against its 2022 target in line with the management’s four-point focus on assumption of office, namely: administrative and operational restructuring; making the service customer-focused; creating a data-centric institution, and automation of administrative and operational processes.
Over the 2020-2022 period, the report said the FIRS performances were based on several reforms introduced by its management bordering on these four-point focus.
“The reforms introduced at different times from 2020 are gradually yielding fruits. By the close of 2022, the Service had fully restructured the administration of the Service for maximum efficiency and achieved internal cohesion, such that all functional units are working in unison towards the achievement of set goals.
“As a result of the conducive environment created for staff, officers of the Service are pulling their weight on the global stage with international recognitions and awards.
“The Service had also automated most of the administrative and operational processes. A major leap was the full deployment of the TaxPro Max for end-to-end administration of taxes in June 2021. The module for the automated TCC went live 1st January 2023 while taxpayers had already downloaded over 1,000 TCCs this year without having to visit FIRS office,” the report said.
It also noted that the Service had operationalised its data mining and analysis system thereby allowing for data-backed taxpayer profiling.
Other reforms the Service introduced during this period, Nami said, focused on the detoxification of the tax environment by ridding it of mutual mistrust, negative tax morale, and tax evasion, through effective taxpayer education, open engagement with stakeholders and improved services.
He said the FIRS achieved the 2022 performance record under his leadership stated through the “dogged implementation of strategic reforms over the past two years; a renewed commitment by officers of the Service, accompanied with a boosted morale as well as the innovative deployment of technology for automation of both tax administration and operational processes.
“This collection was possible through collaboration with our stakeholders, from our colleagues at the Executive branch of government, to the members of the judiciary, to our brothers and sisters at the National Assembly, as well as the tax advisory committee, professional bodies, unions, and most crucially our taxpayers.”
On the outlook for 2023, the FIRS Chairman said the Service would build on the current reforms, achieve full automation and continue to establish a resilient Service that would continue to provide sustainable tax revenue collection to fund the government.
“We intend to maintain, and even improve on the momentum in 2023,” he declared.
“We have peaked. But this is not certainly our peak. In fact, my hope is that this would be the least sum the Service would ever collect going forward.
“Our goal is to identify more areas we can improve on in service delivery and efficiency of our revenue collection, and plug loopholes, while deploying innovative reforms in data and artificial intelligence.
“Ultimately, we believe that the FIRS can shoulder the responsibility of providing revenue needed for the governments across the Federation to cater for the needs of the Nigerian people through taxes.
“This is feasible once we get the much-desired support from the three tiers and arms of government, as well as all stakeholders,” he said.
The FIRS thanked President Buhari, the Minister of Finance, Budget and National Planning, Zainab Ahmed, and the Minister of State, Clem Agba, for their support and encouragement towards this achievement.
Nami said 2022 was the second consecutive year the FIRS would be recording unprecedented tax collection following the N6.405 trillion record achieved in the previous year, being over 100 percent of its collection target for the year.
He said the 2022 record collection of N10.1 trillion was over 96 percent of its collection target for the year.