While businesses and other corporate institutions moan about a poisonous work climate, acting Federal Inland Revenue Service (FIRS) head Zacch Adedeji has ruled out the possibility of a tax increase, saying the government is determined to strengthen the system rather than weaken it.
Adedeji’s guarantees come in response to concerns that the FIRS’ intentions to increase the nation’s tax-to-GDP ratio to 18% from 10.86% will result in a rise in taxes, which will then force many businesses out of business.
However, the acting FIRS chief noted in a statement signed by his Special Adviser on Media and Communication, Dare Adekanmbi, that the current administration is still committed to improving the business climate and expanding the economy, so aiming for a higher tax-to-GDP does not necessarily entail higher taxes or the introduction of new taxes.
Adedeji said that under his leadership, the agency would increase the tax-to-GDP ratio by 8% over the following three years to surpass the continent’s average of 16.5% without jeopardizing investor interests or slowing economic progress.
“Our belief, understanding, and vision as a revenue-generating organization is not to enact any new taxes, as we only want to use data to enhance compliance,” he stated.
“Companies willing to voluntarily carry out their tax obligations have nothing to be afraid of. Our plan is simple. We want to grow tax revenue, and we only want to tax prosperity, not poverty. Therefore, it is not in our interest to kill the trees that bear the fruits.
“We will not collect what is not due to us, but we don’t want anyone not to pay what is due to us. Fair engagement is our plan. Rest assured that the 18 percent tax-to-GDP target will not translate to an increase in taxes.
“If you have been listening to Mr. Taiwo Oyedele, who is the chairman of the Presidential Committee on Fiscal Policy and Tax Reforms, you will have known that part of the mandate of the committee is to reduce the number of taxes,” Adedeji explained.
He argues that the goal of the interaction with the businesses is to incorporate their suggestions into the strategy being developed to address issues impeding the collection of tax income.
He praised the participating businesses for their strong sense of accountability and urged them to keep meeting their tax commitments.
“I commend your commitment to upholding high tax compliance standards and responsible corporate citizenship, which sets you apart as the top taxpayers in Nigeria,” he said.
“This aligns perfectly with our vision of making taxation the pivot of national development through voluntary compliance.
“Your respective industries play a pivotal role in generating substantial tax revenue for the government and in shaping the economic and fiscal stability of the nation.
“We are not unmindful of the challenges facing businesses in Nigeria with the ongoing reforms to improve economic performance. These are painful but necessary choices we must make as a nation to attain our full potential,” he said.
The chairman committed to addressing the issues mentioned while replying to some of the worries expressed by company representatives, such as the complexity of taxes and duplication of tax control on corporate entities.
ExxonMobil, Shell, Guinness, Nigerian Breweries, Flour Mills, Dangote Group, MTN, British American Tobacco, First Bank, Access Bank, Guaranty Trust Bank, Zenith Bank Plc, KC Gaming Limited (Bet9ja), Airtel, Seplat, BUA Cement, Nigeria Liquified Natural Gas, NNPC Limited, and others were among the companies represented at the event.
Comments