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Taxation: Buhari directs agencies, businesses to grant FIRS direct access to systems

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OBINNA EZUGWU

Nigeria’s president, Muhammadu Buhari, has directed businesses and government agencies to grant grant the Federal Inland Revenue Service (FIRS) direct access to their systems in bid to boost revenue drive.

The president who announced the directive in a  tweet on Thursday, said it was informed by the need to use technology to plug all revenue loopholes.

“We must use technology to plug all revenue loopholes. To this end, I have directed all government agencies and business enterprises to grant FIRS access to their systems for seamless connection. FIRS must fully deploy automation, in line with international best practices,” the president said.

Meanwhile, FIRS, on Tuesday, said it collected N4,952,243,711,728.37 in total tax revenue in the year 2020.

The FIRS Director of Communications and Liaison, Abdullahi Ismaila-Ahmad, in a statement on Tuesday, said the generation represents approximately 98% of the national tax target of N5.076 trillion set by the Federal Government.

While briefing the press, Mr Nami pointed out that this near 100% collection feat was all the more remarkable when placed against the backdrop of the debilitating effects of COVID-19 on the Nigerian economy.

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According to the statement, other factors included the all-time low price of crude oil in the international market; business disruptions and lootings during the #EndSars protests.

He added that generous tax waivers granted by the FIRS to ease the impact of the COVID-19 shutdown; additional tax exemptions granted to small companies in the 2019 Finance Act; and insecurity in some parts of the country were all part of the factors.

While analysing the significance of the 2020 performance, he further noted that the FIRS recorded this feat at a time when the price of oil hit an all-time low.

He recalled that oil which used to contribute over 50% in tax returns through the Petroleum Profits Tax in previous years, accounted for only 30.6% contribution to the tax revenue generated in 2020.

He added that the non-oil tax collection was 109% in 2020, which is 9% higher than the previous year.

Mr Nami attributed the FIRS revenue generation success in 2020 to a number of reforms initiated by the Board and Management of the Service under his leadership.

The executive-chairman therefore commended “the conscientious taxpayers in the country and dedicated members of staff of the FIRS nationwide for their support and devotion to work which made this performance possible despite the numerous obstacles encountered by the Service in 2020”.

He added: “The FIRS is optimistic this current fiscal year 2021 will be better than 2020. We shall perform exceedingly well given that our Service reforms are expected to yield greater dividends, especially as different parts of tax administration is being automated.

“We are also optimistic that exploration activities will improve in the oil sector and increase the prospect of higher tax revenue from the sector.

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“Similarly, the ongoing reforms by the Service together with increased stakeholder collaborations will brighten the prospect of improved voluntary compliance and consequently higher tax revenue generation for the country this year and beyond.”