Niger State governor, Alhaji Abubakar Sani Bello has been battling with how to increase the internally generated revenue base of the state, as it became obvious that there were leakages. The desire to block the leakages became very imperative in view of the dwindling revenue allocation from the Federation Account, coupled with myriad of obligations to be met.
Several committees were set up, from technical to harmonisation of the tax revenue system between local and state governments. The practical strides to actualise these steps came with the appointment of Alhaji Mohammed Madami Etsu, as the executive chairman of the state’s Internal Revenue Service.
He was not unaware of the challenges ahead on assumption. He was to discover that Niger State Revenue Collection was far low and thus commenced automation process and launched the Integrated Tax Administration System for the State Revenue Service. Alhaji Mohammed Madami Etsu started with the pilot project from assumed major sources of revenue in Niger State in Suleja, Minna, Bida with other parts of the state following gradually.
On assumption to office, he said “Niger State should climb up there with the first ten states that have the highest number of Internally generated revenue because we have no business been at the bottom of the ladder considering the fact that we have the landmass probably number three or four in population size. So, we are going to explore all these potentials and we are very firm about this, we are going to make changes.
“With the backing of His Excellency, the executive governor of Niger State, I know that we can do it as we have done it elsewhere. Other states have taken a cue from Lagos and the bigger states. Like I said, within the next few months we would start seeing these results,” he said.
Consequently, as determined as he was, he set a target to bring about positive changes in the mechanism of collection; block leakages and go after big time evaders of tax both individuals and corporate entities.
He said the state has been getting between six, to seven hundred million monthly in the last one year, before he was appointed in May this year and assumed office in June. But within the period of June, he was able to increase the internally generated revenue to a little above a billion naira.
According to him “I have started making a lot of effort to change the situation and I can say that as at today, and by our last collection, we have already crossed a billion naira, which is an improvement of three hundred million on the last collection within the first three weeks.”
As a target, he said “I know that Niger State has the potential, we have therefore left it at N1.5 billion and that was my first address to staff with the members of my team, that I am looking at 1.5 billion monthly.”
He said “We are also short of staff and are hoping to restructure this so that we can have competent hands to actually drive what we are looking at, the vision we have for the state. I am hoping that Niger State would climb up there with the first ten states that have the highest number of internally generated revenue.”
With sources of revenue within the state meant to be collected by the Niger State Government fully automated, this has reduced to a minimum level the element of human interface because those are the areas guilty of leakages.
This suffices that within few months of automation, there was an upward spring of revenue collection. Even at the Federal Service and all other states, the tendency of leakages and outright evasion of tax posed serious problems
According to Madami Etsu “Some states will give you a schedule of 100 items, then you come to my state, probably you are just collecting 40 of those items , a lot of them will say multiple taxation is a different topic entirely. But we are trying to modify this lost ground because we have issues of local government coming in to collect something. The state also collects the same thing which is also applicable to state,” that, to him, brought to fore the need for harmonisation.
He said a committee has been set up before he came to harmonise this collection process, adding that, “Once everybody agrees that this IGR is government money, I don’t think we will have issues with that, but the issue of leakages is the major issue anywhere in all services in the country. So, it is a question of how secured is your system of collection and operation and with determination a lot of these leakages will be gravely reduced.”
Last week, the executive chairman called on stakeholders to support the state and local governments harmonised Revenue Law of 2020, geared at revamping the economy and improving the quality of people’s livelihood.
In a statement, he explained that the law was initiated based on pressing economic issues because of the dwindling revenue of the state and local governments and the need to improve development in the state.
According to him, government is committed to delivering the dividends of democracy to Nigerlites in the area of security, social services and prompt payments of salaries to civil servants among others.
Etsu stated that the law is not meant to operate in isolation, but to complement other existing revenue laws as provided in the Constitution of the Federal Republic of Nigeria 1999 as amended.
Others include, the Personal Income Tax Act, Laws of the Federation of Nigeria 2004 as amended and the Niger State Revenue Collection and Administration Law 2011.
The chairman, Mohammed Etsu said, ‘This harmonised legislation of 2020, is not meant to usurp the powers of the local government council’s to collect revenue in their areas of jurisdiction as provided by the Constitution of the Federal Republic of Nigeria 1999 as amended, but to create a synergy between the state and the 25 local government councils in a collective revenue drive.
“This will reduce the incidence of multiple taxation, increase the assessment and collection capacities and boost the quantum of Internally Generated Revenue for both tiers of government.”
In view of this, the State Internal Revenue Service, according to the statement has set up an implementation committee under the leadership of Alhaji Mohammed Murtala King, the coordinator of revenue matters, and has since commenced touring all the 25 local government councils for sensitisation of stakeholders, training of revenue staff and deployment of technology for immediate take off.
In a pilot exercise conducted with Bosso local government, tremendous increase in its IGR collections has been noticed due to the deployment of technology in the revenue collection efforts and has encouraged transparency and accountability in the system.
Also this week, the state Internal Revenue Service closed the branches of eight banks and three other organisations over N456.7m unpaid tax liability. The executive chairman pointed out that the exercise was carried out in line with the provisions of the relevant tax laws.
The affected banks include: Stanbic IBTC (N113.2m) Polaris Bank (N74.8m), UBA (N68.9m), Union Bank (N47.1m), First Bank (N45.7m), Heritage Bank (N31.5m) Unity Bank (N14m) and GTB (N8.2m).
Others were, AEDC Plc (N45.8m), Aloe Vera International Hotel (N3.9m) and Rashida Restaurant (N3.2m).The chairman explained that all efforts by the service to enable the defaulting organisations pay their respective tax liability yielded no positive result.
The new Revenue Service under the leadership of Mohammed Madami Etsu has demonstrated to great extent that the state is poised to ensure that leakages are blocked and has taken the gauntlet to venture into what others may be scared to do.
The events in the last few months has been narrations of giant strides laced with a demonstrated level of competence and professionalism, showing that better days are ahead for internal revenue generation in Niger State.