The Federal Inland Revenue Service (FIRS) has announced that it will propose the introduction of a road infrastructure tax in Nigeria so that the informal sector can help build a modern society.
FIRS Executive Chairman Muhammad Mamman Nami announced this yesterday when he received a delegation from the Nigerian Association of Journalists, NUJ, led by National President Chris Isiguzo in his Abuja office.
Nami said the proposed road infrastructure tax, to be administered by the federal agency, would provide the government with adequate funding for the construction, rehabilitation and maintenance of roads, as well as necessary road safety in the country.
According to the FIRS boss, “a quick and very important intervention is required from you in the area of the road infrastructure subsidy program, which the country needs to repair our roads and to include the informal sector in the control network.”
He noted that “in many jurisdictions, road users pay for the use of road infrastructure, which as such should not be seen as an additional burden on our citizens, as it has the potential to make life better for all of us.”
In addition, Nami stated that Nigeria’s economy currently relies heavily on non-petroleum revenues to meet its legal responsibilities for paying salaries and providing social amenities to citizens.
Without paying taxes, governments at all levels would not be able to fulfill their mandate vis-à-vis the electorate.
He stressed that tax money also helps keep roads safe and always in good condition.
He stated that the recent surge in the price of crude should normally have had a positive impact on the petroleum profit tax payable by oil exploration companies. However, it has turned out differently for a number of reasons, he said.
Commenting on the challenges the service faces in fulfilling its mandate, he said, “Crude oil production has been limited by the OPEC quota. Nigeria’s OPEC rate was around 1.5 Mbit / s in July 2021 compared to its crude oil production budget of 1.8 Mbit / s.
“This is a deficit of 300,000 barrels a day. Our average daily crude oil production is around 1,250 Mbit / d versus the allocated OPEC quota of 1.5 Mbit / s, which has resulted in a shortage of nearly 250,000 barrels per day, mainly caused by crude oil theft and acts of God by some IOCs declared total amount of the production budgeted by the federal government is about 550,000 barrels per day.
“Most companies reported huge pull-forward losses and unbalanced capital additions due to the disruption in production and the drop in oil prices in 2020 as a result of the Covid-19 pandemic, which reduced their revenues.”
He said, given the challenges in the oil and gas sector, reforms have been implemented by the agency that are visible in the economy. Among other things, he included the use of technology in tax administration to improve the mobilization of domestic revenues in the face of falling oil prices in order to avoid falling into a debt crisis.
Nami added that the service had set up 10 regional sales tax (VAT) coordination offices across the country to help drive sales tax collection.
“We started using VAT Form 002A for registration and tracking of branches of large VAT payers. This will certainly improve our VAT collection and capacity. We achieved 114.66 percent of our VAT collection target in the first half of the year.
“You will be interested to know that the service raised a total of N 4.2 trillion between January and September 2021. This feat was achieved due to the efficiency and effectiveness of the TaxProMax solution and the information / data we collected, searched and analyzed . in the observation period.
“The service has successfully supported both the bogus and external audits for the Center for Information Exchange (EOI) ISO 27001: 2013 certification to meet international information security management standards,” he said.
While congratulating Isiguzo on his recent re-election as National President of the NUJ, which reflected his unusual accomplishments at the NUJ, he urged NUJ members to:
Previously, Isiguzo said the union’s visit was part of his determination to involve critical institutions as key players in finding a path for the good of the country.
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The NUJ President described FIRS as a vital institution in the country that “needs all the support it needs, especially at a time when the country is security challenged, affected by Covid-19, and faced with the FOREX crisis and political intrigue is”. from different parts of the nation. “
He said the NUJ had taken note of “the strong efforts made by FIRS to support the country’s revenue through the use of technology and the necessary human resources in this regard.” The Union is interested in your digital technology solution, TaxPro-Max.
“The numbers show that it has helped increase the efficiency of tax administration and collection rates across the country.
“However, with your recent admission that only about $ 44 million out of a possible $ 100 million plus taxes, you are urgently making a solidly integrated media campaign to get more Nigerians into the tax network. This is the NUJ poised to take the lead.”
Isiguzo assured the FIRS boss and his management team that the NUJ would praise the agency where it did a noble job.