- Executive Chairman of Federal Inland Revenue Service, Zach Adedeji
By Anthony Nwachukwu
Tax-friendly policies that will engender voluntary compliance, dissuade evasion and detect evaders, as well as recover lost revenues and prevent leakages will be implemented by the Federal Government through the Federal Inland Revenue Service (FIRS).
The Executive Chairman, FIRS, Zacch Adedeji, stated this in Lagos Tuesday at the annual Commerce and Industry Correspondents Association of Nigeria (CICAN) annual workshop and awards, with the theme, “Effects of the Federal Government’s Tax Reforms on the Economy.”
Coming on the heels of government’s plans to raise tax to Gross Domestic Product (GDP) ratio to 18 per cent in the next three years without impose additional taxes, Adedeji said the move would be aided by relevant tax laws to boost compliance.
However, Adedeji, who was represented by the Director and Coordinator, Lagos Island FIRS, Mrs. Oyeniyi Fadekemi, hinged the success of these reforms also on the business community’s active participation and cooperation, and not on government alone.
To that end, “we call on all stakeholders to embrace these reforms, fulfill their tax obligations and work hand in hand with the government in achieving our common goal of building a strong and resilient economy,” he stated.
He assured that FIRS would create a level playfield for all taxpayers, while noting the importance of combating tax evasion and ensuring that everyone pays a fair tax.
According to him, taxation, as the lifeblood of any economy, provides government the necessary funding for its policies and functions to achieve growth and development. Therefore, Nigeria’s tax policy reforms should be effective, fair, and encourage investment and innovation.
Confirming government’s determination on tax reforms, he noted that on assumption of office, President Bola Tinubu set up a Presidential Committee on Fiscal Policy and Tax Reforms comprising eminent Nigerians from various institutions and professional bodies, with the mandate to reform the tax ecosystem.
“This reform is expected to lead to fiscal discipline, remove all impediments in our tax system and eliminate the ambiguity in our tax laws, which will culminate in the ease of doing business and ultimately lead to improved revenue generated from taxes,” he stated.
According to him, another critical aspect of the tax policy reforms is the promotion of voluntary compliance, rather than punitive measures, as government believes in fostering a culture of voluntary tax compliance through educational campaigns, awareness programmes and taxpayer support services.
“By engaging with taxpayers and providing them the necessary tools and information, a high level of compliance rate is expected to happen. This will in turn help in building trust between the government and the business community,” he explained.
He disclosed that in its recent report, the Taiwo Oyedele-led committee made a number of recommendations that will help businesses, such as “the suspension of VAT on diesel and tax waiver on compressed natural gas conversion and renewable energy items.
Others in include “simplifying withholding tax to ease pressure on the working capital of businesses, suspension of multiple taxes that constitute a burden on poor and small businesses, waiver of penalty and interests upon full payment of outstanding tax liabilities on or before December 31, 2023.
“When implemented, these suggestions will go a long way in helping businesses within the country. This not only enhances the integrity of our tax system but also ensures that compliant taxpayers are not disadvantaged by those who evade tax obligations.”
He added that the FIRS tax policy reforms would enhance revenue generation, attract investment, promote economic growth, and ultimately improve the quality of life for all Nigerians.
Also, the Director General, Manufacturers’ Association of Nigeria (MAN), Segun Ajayi-Kadir, said that MAN’s vision to be the key driver for industrialisation, sustainable economic growth and development in Nigeria has been the thrust of the services it offers to manufacturers.
He expressed hopes that the conference would deliver positive issues and practical steps that will be transmitted to the government to enrich its deliberation and decisions to towards the growth of the manufacturing sector and the Nigerian economy at large.
On his part, the Chief Executive Officer, Centre for Promotion of Private Enterprise (CPPE), Muda Yusuf, said that Nigeria was at a point of sacrifice, with the burden of the sacrifice heavier on the common man.
He stressed the need to hold the Federal Government accountable, to ensure that the outcomes of their economic reforms benefit the citizens.
Earlier in his welcome address, the CICAN National Chairman, Charles Okonji, regretted that since the removal of fuel subsidy, many manufacturing outfits have closed shops.
Noting that tax policies are critical to Nigeria’s growth and development, however, he called on the Federal Government to urgently rejig its tax policies to attract both potential investors and those that had relocated from the country due to the harsh business climate.