February 10, 2020

A tax expert, Mr. Taiwo Oyedele has said that contrary to widely held notion the new finance act will see the rich in Nigeria paying more taxes. Mr. Oyedele, who said this when he delivered a paper titled “Strategies for implementing the New VAT Regime” noted that unlike before, the “well-to-do would now pay their fair share of taxes in the country.” According to a statement made available to the media in Abuja on Sunday by Director of Communications, FIRS, Abdullahi Ismaila, Oyedele noted that erroneous public apprehension that the new 7.5 per cent VAT would impact negatively on poor Nigerians was not correct. Oyedele fore grounded the key to building this fair, equitable tax system in transparency, accountability, integrity, work and objectivity to build confidence in taxpayers and stakeholders in the tax sector. Resident Muhammadu Buhari had early this year signed the Nigerian Tax and Fiscal Law (Amendment) Bill 2019 otherwise known as the Finance Bill into law. The new law contains over 90 changes to 7 different tax laws including: an increase in the rate of VAT from 5 per cent to 7.5 per cent; 0% CIT rate for small businesses and a lower rate of 20 per cent for medium-sized companies; requirement for TIN to open and operate a business bank account; increase in the threshold of online transfers liable to stamp duty of N50 from N1,000 to N10,000; taxation of foreign entities involved in digital transactions with significant economic presence in Nigeria. Presently, Nigeria stands at the threshold of a new, transparent, accountable and fair tax regime in which those who make more from the system pay a more equitable share of their income as tax towards the public good, especially in lifting 100 Nigerians out of poverty in the next 10 years. Earlier, the Executive Chairman, FIRS, Mr. Muhammad Nami, in presenting the Service organigram disclosed that many posts were vacant and open to the FIRS officials. Nami charged staff to distinguish themselves in the shortest possible time by meeting set collection targets in order to take up these available positions of higher responsibilities, stressing that the vacancies are strictly available on measurable merit and performance criteria only. On Friday, the FIRS helmsman had disclosed that “For the year 2020, we have a target of N8.5 trillion. This is broken down into oil tax of N3.7 trillion and non-oil taxes target of N4.8 trillion.” He further said that he and his board have also set a target of improving the Service’s performance over the next four years by a “minimum target of $5 million staff-to-revenue- ration and a 10 per cent tax-to-GDP ratio, adding that the Nigeria was gradually itself of over dependence on oil revenue. He said non oil taxes accounted for 60 per cent contribution to the total taxes collected in 2019.

FIRS is set to induct her new employees. Recall that the said employees completed their documentations December last year. Information leaked from insider revealed that the induction was delayed as a result of change in administration. Also not all that completed their documentations will be involved in this induction. This is because the chairman has decided to place employees in different groups. But I was not told when each groups will be inducted. Please any one with better information should tell us when each groups will be inducted. Thanks.

The Federal Capital Territory Administration (FCTA), has revealed that it intends to generate over N3 billion revenue from outdoor advertisements before the end of first half of 2020. Director, FCT Department of Outdoor Advertisement and Signage, Babagana Adam, said his department has the capacity to generate more than the N500 million realised in 2019, but conceded that he’s been inhibited due to activities of unlawful agents bleeding the system. Adam, however, said that the agency is working on advanced IT driven ways of revenue collection in order to block leakages and prevent further evasion of advertisement taxes. “We generated N500 million in 2019 but the plan is to hit the billion naira mark by May 2020. At the rate we are going, we will exceed that and probably we will be talking about N3billion revenue by May 2020.” He added that the department is currently working out payment plans that will discourage agents from accumulating debts. “The problem is that the FCT has been in limbo for so long and practitioners were allowed to owe for too long unlike places like Lagos where you dare not owe for one month. So what we intend to do is to introduce quarterly payment plan so that agents and practitioners will not accumulate debts.” The Director also revealed that the agency is working tirelessly to recover the N1.9 billion outstanding debt being owed by 86 practitioners who placed advertisement on the 707 billboards across the city. He added that the agency may soon be delisting 45 practitioners that have failed to reconcile their debt profile with them. On ways of resolving issues of double taxation on businesses, he said, “Going forward what we intend to do is, if any of the area council collects advert revenue directly from agents and practitioners, we will calculate all the monies they have collected through the back door, then deduct that amount from the allocation due to them. That way the area councils will realise that there is no point using their own resources to collect revenue themselves when they can allow us do the collection and give them the percentage due to them.