FIRS Targets N8tn Revenue in 2019

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The Federal Inland Revenue Service (FIRS) has set a N8 trillion revenue target for 2019.

This came as it also confirmed that it collected a total sum of N5.32 trillion in 2018, the highest revenue receipt since 2012 when it realised N5.07 trillion.

The Executive Chairman, FIRS, Tunde Fowler, gave the figures Monday at a retreat on “Parliamentary Support for Effective Taxation of the Digital Economy” held in Lagos.

The N5.3 trillion revenue for last year was seen as significant particularly at a period when oil prices averaged $70 per barrel.

Oil price average of $100 to $120 per barrel between 2010 and 2013- but tax receipts fell below the 2018 estimates.

The non-oil component of the N5.320 trillion was N2.467 trillion representing 53.62 per cent of the total collection, while the oil component was estimated at N2.852 trillion or 46.38 per cent.

FIRS collected N212,792 billion in audit from 2,278 cases with a huge reduction in audit circle.

According to Fowler, “While we have been steadily increasing revenue collection over the years, our cost of collection has actually been going down. In 2016, we collected N3,307 trillion, in 2017 we collected N4,027 trillion and in 2018 we collected N5,320 trillion.

“Meanwhile, the cost of collection as a percentage of actual taxes collected has been reducing; in 2016 it was 2.6 per cent, in 2017 it was 2.49 per cent, while in 2018 it was 2.14 per cent.”
He said: “The service has been making tremendous efforts in also increasing the amount of non-oil revenue it collects. Non-oil collection has contributed 64.99 per cent in 2016, in 2017 it contributed 62.25 per cent and in 2018 it contributed 53.62 per cent. This represents the government’s focus on increasing non-oil sources of revenue and the diversification of the Nigerian economy.”

The FIRS boss further maintained that companies, which declare profits, were obliged to pay taxes in the interest of all Nigerians.

He reeled out various initiatives being implemented to enhance tax administration and make taxation as easy as possible.

“Taxpayers can now also choose the tax office where they would like to conduct their tax transactions. Before now, if one was registered with a particular tax office, one had to conduct all of their tax transactions in that office. However, to make it more convenient for the taxpayer, they can now choose whichever office they wish to conduct their transactions with,” Fowler said.

He said FIRS has deployed ICT initiatives that enable a taxpayer to pay taxes from anywhere in the world, at any time, stressing that with the e-payment channel, taxpayers can pay taxes with the click of a button and also download their receipts.

He added that the Nigerian taxpayers are embracing the modern way of tax collection introduced by the service through the six-e solutions.

“We are automating the collection of Value Added Tax (VAT) in key sectors which will facilitate reduction in compliance cost in the long term. We are doing system to system integration between banks and FIRS. And I am happy to announce to you that we had a 31% increase year on year in VAT collection in the banks that have gone live between Jan 2017- Dec 2018 and collected 25bn so far.

“Amongst others, there is also the Government Information Financial Management Information System (GIFMIS), which links FIRS to the Office of the Accountant General of the Federation (OAGF) for real-time exchange of information and data. We are also automating the payment of VAT by states through the State Offices of Accountant General Platform (SAG). This will ensure that we automate and deduct at source and remittance of VAT and WHT from state governments contract payments directly to FIRS’s account and so far, collected N13 billion,” he said.

He noted that taxpayers requested and processed their Tax Clearance Certificate (TCC) through tcc.firs.gov.ng from the comfort of their homes.

“Tax clearance on the platform grew from 9,574 – 59,350 within a year of introducing the platform.

“Auto VAT collection in key sectors has also facilitated in reducing the cost of compliance. Between January 2017 and December 2018 VAT collection increased by 31% which translates to a collection of N25 billion. Overall, in 2019 VAT crossed the N1 trillion mark.

Indeed, VAT is the fastest growing tax type in the world and even rich countries that did not depend on taxation have now introduced VAT, like the United Arab Emirates,” Fowler said.
He also said: “In 2016, FIRS initiated a tax amnesty programme which attracted over 3,000 applications for waiver of interest and penalties. The programme resulted in payment of over N68 billion out of about N96.2 billion liability established by the exercise.

“The Voluntary Assets and Income Declaration Scheme (VAIDS) was initiated by the Federal Ministry of Finance and the FIRS received over 5,122 applications under the scheme. The scheme resulted in voluntary declarations of over N92 billion, with over N54 billion paid so far by companies.”

He further gave insights on how the FIRS ascertained whether companies with banking turnover of N1 billion are tax compliant or not.

According to him, “FIRS wrote to all commercial banks in May 2018, requesting a list of companies, partnerships and enterprises with a banking turnover of N1 billion and above. This activity was aimed at ascertaining those companies that are compliant with the tax laws and those that are not compliant. So far, non-compliant organisations have paid about N21.75 billion.

“Companies that had a Tax Identification Number (TIN) and were paying were 45,261, those that had a TIN but were not paying were 40,611 and those without a TIN and who were not paying were 34,504.”

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Joseph Afam (Local Contents and Partnership Editor) (070 3949 0464) Joseph Afam is a energy and finance journalist, who has years of experience in journalism, he started his journalism career in Nigeria’s top financial newspaper in Lagos. He’s a graduate of Economics and Finance from University of Ebonyi State, Nigeria He has won series of awards and regconitions Contact him for any editorial deals and advertorial issues on # Joseph.Afam@naija247news.com, editor@naija247news.com, Cell: 070 3949 0464

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