Chairman of the Federal Inland Revenue Service, Muhammad Nami has said for Nigeria to achieve meaningful and sustainable growth in tax revenue, and minimize our dependence on oil revenue, there is the need for continuous reform of FIRS’ operations and processes, including its human capital development, the adoption of technology, and the tax laws.
Mr Nami said key areas have remained paramount to the current board and management of the Service. He said the achievements recorded in improving and sustaining the revenue growth since 2020 to date irrespective of the challenges posed by the Covid-19 can be attributed to its reform initiatives.
The FIRS chairman made the remarks yesterday at the highlighted the need to include all revenue generated at the national and sub-national levels in order to properly determine the accurate computation of Nigeria’s tax-to-GDP ratio.
He underscored the need to include all revenue generated at the national and sub-national levels in order to properly determine the accurate computation of Nigeria’s tax-to-GDP ratio.
“In as much as the country needs to continually and conscientiously put measures in place to improve such a concern, there is also the need to comprehensively bring all the national and sub-national revenue sources into consideration to properly and appropriately determine the correct and meaningful tax-to-GDP ratio for the country,” he stated.
Minister of state for Budget and National Planning Clem Agba said the federal government-initiatedEconomic Sustainability Plan (ESP) has saved about 1.3 million jobs through the Micro, Small and Medium Scale Enterprises (MSME) and Payroll support.
In addition, 774,000 jobs were created through the public works programme under the National Directorate of Employment (NDE) and 26,021 jobs were generated from construction/rehabilitation of federal roads under Federal Roads Maintenance Agency (FERMA).
The plan was conceptualised by the federal government to mitigate the impacts of COVID-19 pandemic and the effects of the recession that the country experienced as a result of the economic shut down following Covid-19.
Nami said the current basis for its computation, which mostly focus on the taxes administered at the federal level while leaving out other sources of revenue being generated by the federal, states and local governments and their establishments does not truly reflect its correct standing.
He disclosed that FIRS will through the Ministry of Finance, Budget and National Planning ensure that all government revenue is included in the accounting for taxes generated, including amounts invested by taxpayers in the country’s road infrastructure as a result of Executive Order 007, tax waivers granted to pioneer companies, import and exercise duties waived through the operations of the Nigeria Customs and all other revenues generated by MDAs on behalf of the federal, state and local governments in Nigeria.
If implemented, Nami believes that it will align Nigeria with global best practices in reporting public finance and will ensure a more transparent and more accurate picture of the country’s Tax-to-GDP ratio.
Agba said due to the uncertainty and unpredictability of oil prices in the international market, the government has continually placed a premium on the growth of the non-oil sector in the diversification of revenue sources.