The Executive Chairman, Federal Inland Revenue Services (FIRS), Tunde Fowler has disclosed that the federal government is targeting N 6.747 trillion as tax revenue this year. Speaking in Lagos while making a presentation on the tax amnesty scheme to IoD members in the presentation titled “Achieving Voluntary Tax Compliance: The VAIDS Option”, Fowler said N3.776 trillion is expected from non-oil tax revenue which represents 58.62 per cent while N2.666 trillion will come from oil tax revenue which represents41.38 per cent.
He also said tax compliance level in Nigeria was still below 10 percent adding that current proportion is among the lowest in the world, with countries such as South Africa at 26 percent, and Ghana at almost 16 percent.
He said Nigeria’s low tax revenues are inconsistent with the lifestyles and spending habits of a large number of citizens.
For instance, he cited that properties worth over 2 trillion naira in Abuja were not registered as tax payers.
He said: “Nigeria’s low tax revenues are inconsistent with the lifestyles and spending habits of a large number of citizens. Many are engaged in transfer of assets overseas, use of offshore companies in tax havens and registration of assets in nominee names.’’ He explained that tax evasion constitutes a significant challenge to the government and listed a number of ways through which taxes are evaded. Among these, he said, are manipulation of accounting records, use of complex structures for transactions, non-registration for Value Added Tax (VAT), non-payment of Capital Gains Tax (CGT) on asset disposal and escaping detection of income due to lack of machinery for tracing such.
The FIRS boss, however, warned that under VAIDS, tax evaders will not escape. He explained that the Federal Ministry of Finance, in collaboration with relevant tax authorities, is building a revenue assurance platform through extensive gathering of data from sources that include Bank Verification Number (BVN), Nigerian Financial Intelligence Unit (NFIU), Corporate Affairs Commission (CAC), land allocation and land ownership records, foreign exchange allocation returns and bureaux de change records.
Others are Central Securities Clearing System (CSCS), information from foreign governments as well as whistleblower tips and leaks. The FIRS Chairman instantiated information from foreign governments with the recently passed Unexplained Wealth Order in the UK, Wikileaks, Panama Papers and Automatic Exchange of Information (AEoI), to which Nigeria is signatory.
He stated that IoD members have, as obligations, leading the charge for truthful and voluntary declaration of all income by corporate bodies, voluntary tax compliance as individuals and corporate bodies, being tax ambassadors by raising rax awareness among peers and being exemplary citizens in words and deeds. VAIDS offers tax defaulters a window to declare their indebtedness and escape tax interests and penalties as well as prosecution. The scheme closes on 31 March.FIRS To Generate N6.747trn Tax Revenue In 2018