Oil slump, Coronavirus: FIRS forecasts shortfall in revenue collection
Oil slump, Coronavirus: FIRS forecasts shortfall in tax collection
As the world continue to battle the effect of Coronavirus and oil slump, Nigeria’s tax agency has said the negative economic indices will definitely affect tax collection and government revenue target.
“The need for total compliance and aggressive revenue drive is imperative now in view of the recent crash of oil price from $50 to $29 which will definitely affect our collection from the Petroleum Profit Tax”, the Executive Chairman of Nigeria’s tax body, Muhammad Nami has forecast, according to a statement from the organisation.
The statement noted further: “Similarly, the outbreak of the Coronavirus has occasioned a global economic meltdown with serious consequences to our economy. You will recall that recently about Fifty Nigerian oil-bearing trucks could not discharge crude oil to buyers because of this Coronavirus pandemic. This has the combined effect of reducing government revenue target and, subsequently, the provision of infrastructures and social amenities”
However, the Federal Inland Revenue Service (FIRS) boss is taking measures to mitigate the effects of these unforeseen global challenges on the Nigerian economy.
At an event, in Lagos, Southwest region of the country, the FIRS has unveiled a new electronic and automated platform for taxpayers to file transfer pricing declaration and disclosures in Nigeria and block leakage in tax collection, especially the Stamp Duty collected by banks across the country.
Unveiling the electronic solution platform on Tuesday in Lagos before bank executives and other stakeholders in the tax sector, Executive Chairman, FIRS, Mr. Muhammad Nami, stated that the Service is deploying the automated platforms “to ensure 100% compliance” and tasked the banks to “get fully prepared for the adoption of the new compliance programme as failure to comply is not an option.”
Mr. Nami said: “We earnestly need to shore up against the looming economic meltdown. It is on this note that I solicit your cooperation and understanding in the drive to use automation to rev up our revenue so that the government of President Muhammadu Buhari will be able to deliver on its mandate.”
Also on Wednesday, the FIRS held a “One Day Stakeholders’ Engagement for the Review of Draft Information Circulars on the 2019 Finance Act” in Lagos.
The well-attended technical session saw stakeholders from a broad spectrum of the economy carry out a “joint review of six (6) draft Information Circulars developed by the Service on the implementation of the 2019 Finance Act, to ensure quality of the circulars and proper collaboration for implementation of the Finance Act.”
In his Welcome Address at the event, Mr. Nami said the information circulars “are very important tools for clarifying various provisions of the tax law in line with Section 8(1)(t) of the FIRS (Establishment) Act 2007.”
Mr. Nami told the gathering that the final circulars envisaged from the stakeholders’ inputs “will assist in achieving the objectives of the 2019 Finance Act to raise revenues to fund public goods and services; promote fiscal equity; reform domestic tax laws to align them with global best practices; introduce productive tax incentives; support micro, small and medium businesses; and to actualise the Ease-of-Doing Business Reforms.”