‘How to address taxation, revenue loopholes in maritime, aviation sectors’

FIRS, Pedabo worry over losses to crude oil lifting vessels
Unless the Federal Government and other stakeholders address challenges bedeviling the nation’s maritime and aviation sectors, projected benefits, especially in the areas of revenue may remain elusive.

Industry players, led by Federal Inland Revenue (FIRS) and Pedabo Professional Services expressed concerns over revenue losses to crude oil lifting vessels from Nigeria.

Speaking at a Thought Leadership Session for Shipping and Aviation sectors organised by FIRS and Pedabo, the experts stated that the Federal Government may need to take necessary measures to make foreign haulage companies, especially multinational shipping firms to comply with extant regulations even if they operate only on the international seas.

They also raised concerns over multiplicity of charges, levies, and taxes in the sectors, noting that there was need to address the situation for the sectors to grow.

The experts insisted that adopting the same presumptive tax rate of six percent as is done in other industries might be counter-productive in the shipping and aviation sectors, adding that consolidation of accounting mechanisms as well as a single revenue authority remains sacrosanct for the country.

While Pedabo insisted that challenges plaguing the industry were man-made, the Executive Chairman of FIRS, Muhammad Nami tasked the Federal Government to block leakages in the accounting and revenue segments of the economy through consolidated accounting mechanism and a single revenue authority.

Existing gaps, according to them, provide room for leakages and limit revenue and accounting potentials.

Nami said there was a need to consolidate or aggregate the country’s accounting mechanism to ensure taxes paid are accounted for by a single revenue authority in the country.

To him, the development would ensure that taxes collected on behalf of the government are remitted to fund budgetary allocations, social amenities as well as critical infrastructure.

Managing Partner, Pedabo, Ajibade Fashina had similarly stated that the shipping and aviation sector can leapfrogincrease contribution to Gross Domestic Product (GDP).

Speaking on blocking the leakages in the country’s tax system to boost remittances, he said the law is certain and is being improved regularly, through, for example, “The Finance Act that is being reviewed on a yearly basis. They (FIRS) identify the leakages and loopholes, and they are blocking those loopholes, and that is what should be done.

“Maybe the government needs to think more around what the money is being used for. Who is collecting what? Why are so many of those funds, which more or less, form parts of the revenue not going into the national purse? I think those are issues that need to be addressed,” Fashina added.