FIRS AND ITS HISTORIC N10.1 TRILLION
When the music is good to our ears, we dance. And if we cannot dance, then we clap. Or we do both!
This piece is not to sing the praises of a government agency without rhyme or reason. It is a fact based opinion piece on the historic feat of the Federal Inland Revenue Service (FIRS) in recording its highest ever tax collection of N10.1 trillion in a single year.
The first indication that FIRS could cross the N10 trillion mark came in September last year when it collected N7.5 trillion in tax in nine months to surpass its entire 2021 figure of N6.4 trillion.
It was at that point that it became obvious that the reforms introduced by Muhammed Nami within a year of assuming office as FIRS Executive Chairman in 2019, had began to yield dividends.
Indeed the fruits of those reforms began to show in 2021, one year after the global lockdown caused by COVID-19, with a tax collection figure of N6.4 trillion,which at the time was the highest ever revenue recorded by the Federal tax agency.
Even at that, the 2022 target of N10.4 trillion looked like a tall dream. Not because of capacity or the lack of it, but because adding N4trillion to the historic figure of the previous year simply looked unattainable at a time much of the world was still feeling the impact of a global economic crisis.
But surprisingly, the FIRS chairman, like a man with a gift of clairvoyancy had told the House of Representatives Committee on Finance at a public hearing on the 2022-2024 Medium Term Expenditure Framework (MTEF) and Fiscal Strategy Paper (FSP), sometime in August 2021, that the agency was projecting to collect tax revenue of over N10 trillion for 2022.
And that was exactly what happened with the 2022 Performance update showing an unprecedented figure of N4.09 trillion from the oil sector and N5.96 trillion from non-oil to bring the total collection for the year to N10.1 trillion.
So what were the factors responsible for the two back-to-back record collection feats?
A look at what Nami brought to the table after assuming office may provide some insight into what has been happening in the last 3 years.
He came into FIRS with a private sector background and, I dare say, mentality and immediately set out what he wanted to achieve in a four-point agenda: to rebuild the FIRS institutional framework; to improve collaboration with stakeholders; to make the FIRS a customer-centric institution and to make the agency a data-centric institution.
These were the pegs on which the historic feat could be hung especially as the reforms played major roles in breaching the N10 trillion revenue collection mark.
“The reforms introduced at different times from 2020 are gradually yielding fruits. By the close of 2022, the Service had fully restructured the administration of the Service for maximum efficiency and achieved internal cohesion such that all functional units are working in unison towards the achievement of set goals.
“As a result of conducive environment created for staff, officers of the Service are pulling their weight on the global stage with international recognitions and awards.
“The Service had also automated most of the administrative and operational processes. A major leap was the full deployment of the TaxPro Max for end-to-end administration of taxes in June 2021. The module for the automated TCC went live 1st January 2023 while taxpayers had already downloaded over 1,000 TCCs this year without having to visit FIRS office,” the report read.
It is interesting to note that the report also stated that the N10.1 trillion does not include tax waived on account of various tax incentives granted under different laws which according to FIRS amounted to N1,805,040,163,008.
This is certainly a huge figure that shows the possibility of the agency doing better not only in the 2023 financial year but also in coming ones.
In the midst of all these is the long standing vow by President Muhammadu Buhari to break Nigeria’s over reliance on oil and from all indications the FIRS management has keyed into it with its performance especially in the last two years.
This ongoing effort to wean the country from its over dependence on revenue from oil is a major reason why Nigeria did not suffer the full effect of the drop in global oil prices.
Today, the revenue projection for 2023 showed that 78% of total revenue is coming from the non-oil sector and of course the FIRS is bound to be a major contributor.
And this is visible from how the agency has shown, for two years running, that it has the necessary capacity to be the lead contributor to the good performance of the non-oil sector.
But more importantly is that FIRS has shown that it will be instrumental in any effort to address the country’s revenue challenge.
Mr. Dapo Okunbajo is a public affairs commentator and veteran journalist.
“Nigeria College of Taxation and Fiscal Studies” Bill Passes Second Reading
A bill for an Act to establish the Nigeria College of Taxation and Fiscal Studies passed its Second Reading last week at the Senate.
The presentation of the Bill was made by Senator Abdullahi Aliyu Sabi CON on the floor of the Senate Tuesday last week, where he noted that the institution, if established would provide professional and academic training as well as certification for tax administrators, tax practitioners and tax professionals across the country.
In his presentation, Senator Sabi, who represents Niger North Senatorial District of Niger State stated that the College had become necessary given the important role that taxation is playing in the nation’s economy, and that this institution would help formulate and draft tax policy for the country while addressing human capital gaps in the country’s tax industry.
“It is becoming increasingly clear that diversifying the sources of government revenue to focus on sustainable sources is inevitable. This diversification puts taxation at the centre of the revenue mobilization discussion; the attainment of this laudable objective would require tax experts who have been properly and adequately schooled to formulate tax policy, draft and interpret tax legislation, carry on private tax practice, and administer taxation in the modern era.
“In view of the constant shift in the social, technological and business environment, with direct impact on the tax system, it is is important to have skills, competence, and adaptable personnel to man the tax system. There must be a conscious development of the field of taxation and fiscal policies in Nigeria to awake the society on the importance of taxation as a sine qua non to our development.
“Nigeria must go beyond the mere inclusion of taxation in the curriculum of educational institutions; instead the country must establish a modern system that facilitates the study of taxation via a well laid out academic curriculum, guided and focused by practical realities of Nigerian taxation and the revenue ecosystem,” he noted.
Senator Sabi further emphasised that the College would help in tackling the issue of lack of sufficient capacity of tax officers, which he noted has led to “the delegation of powers of revenue authorities to third parties, creating complications, multiplicity and uncertainty in the tax system,” and that it would correct “aggressive and orthodox methods for tax collection” while also carrying out a “regular review of obsolete tax laws that do not reflect modern realities.”
He noted that all these would help the country address its fiscal and revenue challenges and achieve the objectives of the National Tax Policy.
In his presentation, the distinguished Senator representing Niger North also cited that countries such as Kenya, Japan, India, Australia, Austria, Singapore, and Malaysia have established similar institutions for developing capacity in taxation, excise duty and customs and fiscal matters, and that this has impacted positively on their economy through significantly high tax-to-GDP ratios.
This College is expected to provide training for tax officials, including officers of the Federal Inland Revenue Service (FIRS), Nigeria Customs, sub-national revenue authorities, and even the general public. It is to consist of a main campus and 12 regional centres.
The Bill proposes that the College would be funded chiefly by the extant yearly subvention of the FIRS for training thus requiring no direct impact on government spending.
Senator Adamu Aliero representing Kebbi Central District, Kebbi State, commenting on the Bill noted that the only sustainable source of revenue for the Federation was taxation, and that the proposed College would train tax officials who would be instrumental to widening the country’s tax net.
He also added that there is currently no institution in Nigeria that offers specialised training in taxation.
NLC, CBN meet in Abuja over Cash scarcity
In less than 24 hours after the leadership of the Nigeria Labour Congress, NLC, directed all its branches and affiliate unions to mobilize members for a shut down of all the branches of the Central Bank of Nigerian, CBN, across the country, over cash scarcity, the apex bank on Thursday evening met with the NLC at the Labour House Abuja.
Recall that the Comrade Joe Ajaero-led NLC, had on Wednesday while addressing journalists said that activities in all branches of the CBN nationwide and the Abuja headquarters will be shut down on Wednesday next due to the cash crunch in the country.
Comrade Ajaero had advised workers to stockpile food items as the industrial dispute with the CBN will be total.
He said Nigerians have been subjected to untold hardship occasioned by the scarcity of naira notes to attend to medical needs and other areas of need.
Vanguard gathered that the NLC threat to paralyze activities at the CBN necessitated the impromptu meeting which started at about 5 pm on Thursday.
The two man delegation made up of the CBN Deputy Gpvrrnor in charge of operations and the Deputy Governor in charge of Economic Pokicy, told the NLC President that about two billion naira was pushed out on Thursdsy in a bid to address the hardship.
A source privy to the meeting told Vanguard that the CBN promised to ensure that the scarcity of naira notes will come to an end as quickly as possible.
“They said the money they pushed out today is equivalent to the whole money pushed out within the week. They also promised to work day and night starting from this night to ensure that there is enough money in the banks,” the source said.
He further said that the CBN denied the allegation that it was printing money out of the country and that the Governor, Godwin Emefiele has directed that the old naira notes should be made available to customers.
Besides, the source denied the allegation that the old naira notes have been burnt, assuring that there will be remarkable improvement in few days to come.
It was gathered that the NLC President, Comrade Ajaero told the CBN delegation that he was not interested in how much that was pushed out, but only interested in seeing that workers and other Nigerians collect their money in banks without stress..
“The President told them that it does not bother us how much they pushed out, our concern is to see that this hardship comes to a stop.
“He also told them that they should work day and night to solve the problem and will depend on the feedback from the average Nigerians who go to the banks to make withdrawals whether there is improvement before Wednesday next week NLC planned to picket the apex bank ,” the source said.
When contacted, the NLC President, Comrade Ajaero, confirmed the meeting and said that the interest of the leadership is to see that Nigerians are able to withdraw their money devoid of the hardship they are passing through.
“We will only know that they are serious when we see improvement,” he added.
EFCC Arraigns FCMB Manager Over N55Million Overdraft Fraud
The Economic and Financial Crimes Commission, EFCC, has arraigned one Kichime Gomwalk, a bank manager and two others for alleged fraud.
Gomwalk of First City Monument Bank (FCMB), Michael Damkas Buayam of Tan Global Energy Limited, and Abbas Andrew Dayilim of Castlegate International Limited were arraigned on Tuesday before Justice P. S. Gang of the Plateau State High Court Jos.
The accused persons were arraigned on five counts bordering on stealing, cheating and obtaining by false pretence money to the tune of N55,000.000.00 (fifty-five million naira).
Gomwalk, while serving as the manager of the bank’s branch at Murtala Mohammed Way in Jos, the Plateau State capital, was alleged to have forged COCIN Gratuity Certificate of Pledge/Letter of Set-Off dated December 30, 2019, purportedly co-signed by Mrs. Monica Bitrus Tang and Rev (Dr.) Amos Musa Mohzo, Directors.
It was allegedly used to secure an overdraft facility from FCMB Plc to the tune of N55 million with COCIN Gratuity account number 100GOMWALK379 domiciled with FCMB Plc.
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