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FG denies plan to raise taxes, moves to capture evaders

By Mathias Okwe, Abuja
25 December 2018   |   3:38 am
Finance Minister, Mrs. Zainab Ahmed, has clarified that the Federal Government is not planning to raise taxes next year as is being erroneously held in certain quarters.

• To implement charges on luxury items, sanction revenue agency heads for shortfall

Finance Minister, Mrs. Zainab Ahmed, has clarified that the Federal Government is not planning to raise taxes next year as is being erroneously held in certain quarters.

Instead, she said what she meant last week at the 2019 federal budget breakdown was that government next year would enlarge the tax net by ensuring that all high network individuals who had been dodging tax payments are captured.She made the clarification yesterday in Abuja at a world press briefing on the activities of the ministry in 2018. The minister also declared that henceforth, all heads of revenue generating agencies in the country would be held culpable for revenue under- performance as part of strategies to combat failing revenue performance.

On the tax reform plan, she said: “We are not in any way increasing our tax rate, but collection. If anything, we are reducing taxes paid by the Micro, Small and Medium Enterprises (MSMEs) as a way of encouraging the growth of businesses.

“What the new reform seeks to achieve is targeting high network individuals who do not pay taxes. We are also going to implement the luxury item taxes which approval has since been received but for which implementation is yet to begin.”

As a prelude to the action next year, the minister recalled that she had recently constituted eight Tax Appeal Tribunals (‘TATs’) across the nation to accelerate the resolution of over 209 pending cases relating to tax revenues of about $18.804 billion, N205.654 billion and €0.821 million. “This is critical to ensure that tax payers get a fair hearing and expedite resolution of tax disputes.”

Ahmed explained that the tax dispute resolution mechanism would reduce incidences of tax evasion and improve payers’ confidence whilst ensuring fairness and transparency of tax.She gave more insight into the new tax reform plan: “To take advantage of innovative technologies, we plan to leverage data, technological tools & platforms to foster collaboration, grow the revenue base and improve collections. Given the span of stakeholders that form our port community and for the sake of improving ease of doing business, we plan to deploy a national single window/trade platform that we expect to enhance Customs collections to about 90 percent over a few years.

“We will also improve collaboration between our revenue collection agencies including the Nigerian Customs Services (NCS), Federal Inland Revenue Service (FIRS) and other trade partners to share information and intelligence that will help improve revenue and make collections more efficient. Reviewing the Federal Government’s expenditure performance in 2018, the minister said despite the revenue shortfall, the government was able to pay salaries and service debts 100 percent.

“We have released seven months overhead funding, and N995billion capital releases by 21st December 2018. We plan to perform better during the rest of the budget year by driving up revenue generation to improve the fiscal space for spending.“In 2018, despite the revenue shortfall we have been able to pay inherited debts and liabilities which this administration received in 2015.”

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