For Nigeria to attain optimum tax revenue collection capacity across the Federal, States and Local Government tax authorities, the country must make hard but necessary reforms that would yield long term benefits.
This was the position stated by Chairman, Joint Tax Board (JTB), Mr. Muhammad Nami, at the 153rd Meeting of the Board on Monday 7 August, 2023 in Abuja with the theme: “Harmonization and codification of taxes at the National and Sub-national levels: Key to achieving a tax friendly environment in Nigeria.”
In his address to the JTB at the event, Mr. Nami, who is also the Executive Chairman of the Federal Inland Revenue Service (FIRS), stated that for progress to be made in taxation, tax authorities must continue to explore and adopt measures and innovative initiatives that will lead to the optimisation of tax revenue for all levels of government.
His words: “As the new administrations attempt to address the many socioeconomic challenges facing the nation on many fronts, it becomes imperative for all the levers of State to shake-off any lethargic antecedents and focus on the goal of a national resurgence.
“The unique and privileged offices we occupy as drivers of the nation’s tax administration processes presents us with a rare opportunity to take hard, but necessary decisions that are expected to yield long-term benefits and add immense value to our collective prosperity as a nation.
“In recent years, especially since the dawn of our current democratic dispensation, the importance of taxation has continued to be reiterated and reinforced by all, and the critical role that tax-revenue plays in funding government and governance cannot be over-emphasized.
“However, as we continue to make progress in our unique model of taxation, it is appropriate that we continue to explore and adopt measures and innovative initiatives that will lead to the optimization of tax revenue for all the levels of government, in more efficient, more effective, more inclusive, and more sustainable ways.
“It is only by achieving this, that our efforts as tax administrators can trigger the manner of activity required in the productive sectors of our economy, towards achieving the immense economic potentials that we are capable of,” Mr. Nami said.
The FIRS chief assured Executive Chairmen of State Revenue Authorities present that given the thrust of the current administration’s tax policy direction, the country was on the pathway to eradicating multiplicity of taxes as a core of its overall economic regeneration objectives.
Delivering a presentation on the theme of the meeting, Chairman, Presidential Fiscal Policy & Tax Reforms Committee, Mr. Taiwo Oyedele, stated that multiple taxation was causing low tax morale in the country, and discouraging investments, while creating room for corruption and making doing business difficult.
Mr. Oyedele noted that the solution to the country’s revenue challenges was not to introduce more taxes, but to focus on the few taxes that were high yielding, noting that with these, tax authorities would be able to collect far more than is currently being collected.
He stated that for the government to raise more revenue, it needed to get to a point where the total number of taxes collected at the federal, state and local government levels would be at a single digit.
“We also need to clarify on taxing rights. We need to integrate tax collection functions—that is, all revenues that are to be collected must be collected by a single revenue agency. Government must also do well to fund our tax agencies well. We also need to harmonise revenue administration and simplify our approach to tax compliance,” Mr. Oloyede added.
He advocated that the country’s tax authorities should deploy more technology, review the country’s constitution and tax laws, as well as revisit Nigeria’s concept of fiscal federalism, according to a statement made available to The Dream Daily Newspaper in Abuja by the Special Assistant to the Executive Chairman, FIRS (Media & Communication), Johannes Oluwatobi Wojuola.