The Federal Inland Revenue Service (FIRS) in Nigeria has introduced an updated Value Added Tax (VAT) filing procedure on its TaxPro Max system. This new module is a mechanism introduced to validate all the input VAT to be paid by taxpayers and entrenches transparency and accountability in VAT administration. The FIRS has engaged with stakeholders, including taxpayers, in the formulation and implementation of this update, and it aims to expand the tax net, mitigate avoidance, evasion and outright fraud. By adopting this new filing process, taxpayers will be able to get their Tax Clearance Certificate in less than one minute at the click of a button, compared to several months before.
This update will improve the tax to GDP ratio and provide fiscal buffer to the government by optimizing VAT revenue collection and blocking revenue leakages in tax administration. Through stakeholder engagement, taxpayer enlightenment and sensitization campaigns through the media, the FIRS is making an effort to ensure that taxpayers key into this update. The short term goal is to ensure prompt and accurate remittance of VAT on a monthly basis, while the long-term goal is to mitigate avoidance, evasion, and fraud. The FIRS advises all taxpayers to key into the new update of VAT filing and make sure that their input VAT can be validated and recognized.
The updated VAT filing procedure on the TaxPro Max is a significant development in Nigeria‘s tax administration system. The introduction of this new module is aimed at improving transparency and accountability in VAT administration and blocking leakages in revenue collection.
One of the benefits of this update is that it will help to increase the tax to GDP ratio in Nigeria, which is currently low compared to other countries. With the optimization of VAT revenue collection, the government will have more fiscal buffer to fund its programs and services.
It is also important to note that the FIRS has carried out stakeholder engagements and sensitization activities to ensure that taxpayers understand the new update and can key into it. Taxpayers are expected to register for VAT and make attribution every month, while businesses are expected to procure goods or services from compliant taxpayers who will accurately remit the VAT paid to the government in a timely manner.
In the long run, the implementation of the updated VAT filing procedure is expected to expand the tax net, mitigate avoidance, evasion, and outright fraud, and ultimately improve Nigeria‘s economy.
Overall, the updated VAT filing procedure on the TaxPro Max is a positive development in Nigeria‘s tax administration system and a step towards achieving greater compliance and revenue collection.
