Businesses plead for streamlined taxes, as FIRS plans e-invoicing

•Taxes are being harmonised, penalties not above 10%- FIRS declares

Businesses have decried the variance in the taxes and levies slammed on them by the Federal Inland Revenue Service (FIRS), saying that a clearer, concise guideline is needed to ensure compliance.

They also described the current process as overly laborious, adding that the tax burden is becoming too heavy to bear in the light of current challenges facing MSMEs.

Speaking at a one-day Lagos Chamber of Commerce and Industry (LCCI)-FIRS Organised Private Sector (OPS) stakeholder’s engagement put together by the LCCI in partnership with the FIRS and themed: ‘Emerging Tax Matters, ’Treasurer, Institute of Chartered Accountants of Nigeria (ICAN), Dr Seyi Olanrewaju, who represented the Diamond President, ICAN, Davidson Alaribe, asked for clear and concise guidelines to ensure compliance.

He also asked for a reduction in the different numbers of taxes to reduce the burden of businesses. Also lamenting that businesses cannot keep up with frequent changes in tax policies, he said the taxes in question are not clearly defined and are often interpreted at will leading to variance.

He urged the FIRS to provide guidance and assistance to MSMEs, adding that they are already struggling with so many issues and costs and taxes shouldn’t be an added burden.

Olanrewaju urged the tax body to establish a feedback mechanism between themselves and taxpayers to address concerns effectively.

Yesterday, the Federal Inland Revenue Service (FIRS) announced its plan to launch the FIRS e-Invoice, a digital platform designed for efficient invoice management, in accordance with the Tax Administration and Enforcement Act of 2007.

The FIRS emphasized that the implementation of e-invoices is essential for the nation as it advances towards innovating and improving its tax system.

In his keynote address, Executive Chair, FIRS, Dr Zacheus Adedeji, represented by Acting Director, Medium Taxpayers Department, South, Otivbo Olaniyi, vowed that all tax services are being harmonised to better support economic growth and development.

As part of reforms, he said they have created a one-stop-shop for both tax office and tax audit functions within an integrated department, ensuring that all matters relating to taxes are handled in the tax office.

“VAT Coordination, Stamp Duty Office and the like, have been scrapped to forestall harassment of taxpayers by multiple functions. The newly developed Taxpro Max allows taxpayers to file returns and access various tax services online, demonstrating our commitment to facilitating easy and efficient tax management,” he stated.

President of LCCI, Gabriel Idahosa, said the theme is timely and crucial given the evolving fiscal landscape, adding that taxes are necessary in shaping economic growth, promoting equity and enabling sustainable development.

Expressing sadness at Nigeria’s current tax-to-GDP ratio, which stands at 10.86 per cent, he said this is far below the African average of 15-20 per cent.

Praising some of the recommendations made by the Presidential Committee on Fiscal Policy and Tax Reforms, chaired by Taiwo Oyedele, he said the OPS is indispensable in Nigeria’s economic development and by extension, its tax base.

Decrying multiple taxation, which he said continued to pose a significant challenge to businesses, he called for better collaboration between the OPS and government to ensure that tax policies support business innovation and competitiveness.

Adedeji added that part of the reforms exempts small businesses from withholding tax compliance, has reduced rates for businesses with low margins, and exemptions for manufacturers and producers in farming. Adding that there are several incentives to attract foreign investments and support local industries, he said this includes zero VAT on Feed Gas for all processed gas, Compressed Natural Gas (CNG), Imported Liquefied petroleum gas (LPG), LPG and CNG equipment components, conversion and installation services and all equipment relating to the expansion of CNG and LPG, including conversion kits.