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We Will Leverage On Finance Act, 2021 To Achieve Adequate Funding For Budget – FIRS

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Muhammad Nami

“In the past, situations abound where certain goods or services streamed into Nigeria by non-resident companies – Nami

Olushola Okunlade Writes

The Federal Inland Revenue Service (FIRS) has stated that it would use the instrumentality of the Finance Act 2021, through collaboration with taxpayers and key stakeholders to ensure adequate funding of the country’s budget and raise the requisite financing for national development.

This was stated by the Executive Chairman of the FIRS, Muhammad Nami, yesterday while delivering the keynote address at the KPMG’s Webinar on Nigeria’s 2022 Budget and the Finance Act 2021, where he also noted that the Act had provided a framework for equitable treatment, automation, and deployment of ICT infrastructure, a single agency for tax collection, taxation of the digital economy among other critical interventions for improved tax administration in the country.

On equitable treatment, Mr. Nami explained that: “In the past, situations abound where certain goods or services streamed into Nigeria by non-resident companies, especially to consumers (B2Cs), were not subject to VAT. This raised the issue of equity, as goods and services offered by domestic companies are subject to VAT.

“With the amendment of Section 10 of the VAT Act and our publication of the ‘Guidelines on Simplified VAT Compliance Regime for Non-Resident Suppliers’, there is now a mechanism for applying VAT on such goods or services, affording the same tax treatment to both local and foreign supplies. 

“Similarly, Companies deriving income from Nigeria without physical presence can now be assessed, like other companies with a physical presence, on a fair and reasonable percentage of their turnover in line with Section 30 of CITA.”

On the automation of tax processes, the FIRS Executive Chairman noted that: “with the amendment of Section 25 of the FIRS Establishment Act, the Service can now deploy either proprietary or third-party developed technologies for tax administration. Those that may still stand in the way of achieving this objective will now be liable to a daily penalty of N25,000.

“With the extension of secrecy and confidentiality requirements to other persons, like service providers, vendors and consultants of the Service, the fear of taxpayers are further allayed on the secrecy and confidentiality of their commercial and other information.”

Muhammad Nami further noted that with the amendment to Section 68 of the FIRS Establishment Act by the Finance Act, complaints from taxpayers about multiple agencies of government demanding payment of tax from them had been addressed.

“This unfortunate situation is not in line with the national tax policy thrust and was causing confusion for our taxpayers and increasing their cost of compliance. However, the amendment to section 68 of the FIRS Act by the Finance Act 2021 has made it clear that FIRS is the only agency responsible for tax assessment, collection, and enforcement. As such, taxpayers are to expect a streamlined tax administration regime going forward.”

Mr. Nami stated that the Service will deploy compliance and enforcement strategies, and will leverage intelligence and strategic data mining and analysis, to provide intelligence and information to enhance its audit and investigation functions, while also reducing the prevalence of tax abuse in incentive management in the country.

Taxation

CITN 24th Annual Tax Conference: Yemi Osinbajo Drums Support For FIRS Digitisation Agenda

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CITN 24th Annual Tax Conference: Vice President Yemi Osinbajo Drums Support For FIRS Digitisation Agenda

CITN 24th Annual Tax Conference: Vice President Yemi Osinbajo Drums Support For FIRS Digitisation Agenda

Olushola Okunlade Writes

The Chartered Institute of Taxation of Nigeria (CITN) has been urged to support the Federal Inland Revenue Service (FIRS) in its drive towards full digitalisation of tax administrative processes.

Vice President Yemi Osinbajo SAN made this call in his speech at the Chartered Institute of Taxation of Nigeria’s (CITN) 24th Annual Tax Conference held at the International Conference Centre, Abuja.

The Vice President was represented at the event by the Executive Chairman of the FIRS, Muhammad Nami who delivered the address on his behalf.

Professor Osinbajo noted that the theme for the tax conference, “Global Disruption, Taxation, and Digitalisation: Implication for Socio-Economic Development” aptly captures the prevailing realities within the national and global fiscal space.

CITN 24th Annual Tax Conference: Vice President Yemi Osinbajo Drums Support For FIRS Digitisation Agenda
Executive Chairman, FIRS, Nami Muhammad, delivers the keynote address at the Chartered Institute of Taxation 24th Annual Tax Conference in Abuja on behalf of Vice President Yemi Osinbajo SAN. 18th May 2022.

He said, “Nigeria’s economy is fast digitalising”. The digitalisation of the Nigerian economy means that the ways and manners of organising and doing businesses have changed. Indeed, the radical changes brought about by digitalisation have displaced the traditional approach to tax administration. Consequently, the digitalisation of tax administration is unavoidable, that is why  our government has continued to heavily invest in the automation of tax administrative processes and digital infrastructure.”

He further noted that the government had provided the enabling environment for digitalised tax administration by making necessary tax policy changes, developing rules for taxation of the digital economy, enactment of required legislation, and providing necessary political backing for the team negotiating the new international tax rules for the digitalised economy.

CITN 24th Annual Tax Conference: Vice President Yemi Osinbajo Drums Support For FIRS Digitisation Agenda
Executive Chairman, FIRS, Nami Muhammad with Dr. James Kayode Naiyeju, FCTI; CITN President, President, Chartered Institute of Taxation of Nigeria, Adesina Isaac Adedayo, mni, FCTI; Vice President CITN, Agbeluyi, S.O. (Barr.), FCTI and Chairman 24th Annual Tax Conference Committee, Ruth Oluwabamike Arokoyo, FCTI, at the Chartered Institute of Taxation 24th Annual Conference in Abuja. 18th May 2022.
CITN 24th Annual Tax Conference: Vice President Yemi Osinbajo Drums Support For FIRS Digitisation Agenda
Executive Chairman, FIRS, Muhammad Nami, with President, Chartered Institute of Taxation of Nigeria, Adesina Isaac Adedayo, mni, FCTI; Vice President CITN, Agbeluyi, S.O. (Barr.), FCTI; Chairman 24th Annual Tax Conference Committee, Ruth Oluwabamike Arokoyo, FCTI, Dr. James Kayode Naiyeju, FCTI, and CITN past Presidents at the Chartered Institute of Taxation 24th Annual Conference in Abuja. 18th May 2022.

The Vice President urged the institute to see its role in society as a pillar for the country’s socio-economic development.

“The possible impact of non-compliance by taxpayers-whom you hold briefs for—on the government’s revenue and the larger society is crucial and must be given topmost priority while holding briefs for them.

“In doing so, you must always bear in mind the pronouncement of the Court of Appeal in Phoenix Motors v. National Provident Fund Management Board (1993) that it is in the best interest of the society at large that government be in revenue.

“It is through this prism that I see your Institute as a pillar for the socio-economic development of Nigeria and the emancipation of the downtrodden of our society. Without a doubt, your members will continue to discharge the solemn and sacred responsibility of ensuring that the interest of the larger society in Nigeria is not trodden upon; and this you must do with patriotic zeal.” He noted.

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FIRS Calls For Increased Collaboration Within African Countries To Effectively Tax Digital Businesses

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FIRS Calls For Increased Collaboration Within African Countries To Effectively Tax Digital Businesses

FIRS Calls For Increased Collaboration Within African Countries To Effectively Tax Digital Businesses

Olushola Okunlade Writes

The Federal Inland Revenue Service (FIRS) has stated that there is a need for improved collaboration among countries and international stakeholders with the aim of exploring alternative rules that will enable market jurisdictions, particularly African countries, to effectively subject digital businesses to tax.

This was stated during a presentation by the Executive Chairman of the FIRS, Muhammad Nami last week, Friday at a Technical Assistance Programme organized by the African Tax Administrators’ Forum (ATAF) with the theme “Member’s Needs and How To Broaden the Collaboration,” held in Lomé, Togo.

Mr. Muhammad Nami in his presentation noted that although some African countries had endorsed the Organisation for Economic Co-operation and Development (OECD) Inclusive Framework’s global solution to the tax challenges of the digitalized economy, Nigeria continues to maintain its position that the outcome will not be favourable to African countries.

According to him, “Nigeria continues to hold the view that the outcome will produce very minimal revenue comfort for African counties. This is instructive considering the implementation challenges that developing jurisdictions will face due to the complexity of the Pilar 1 and 2 rules.

“Our analysis continues to show that the possible cost of administering and implementing the complex rules will far outweigh the expected revenue accruing from its implementation.

“I, therefore, urge the African Tax Administrators Forum to join the discussion at the UN Tax Committee of Experts, South Centre, as well as collaborate with all other well-meaning stakeholders to explore alternative rules that will enable African countries to effectively subject the digital businesses and base eroding payments to tax in our jurisdictions.

“These collaborations should extend to other rules developed and implemented at the international level for the taxation of Multinational Enterprises, such as the tax treaty, exchange of information and transfer pricing rules.” Muhammad Nami stated.

He further called for the African Tax Administrators Forum to collaborate with the United Nations Development Programme (UNDP) to explore opportunities for Africa within the programme’s Tax for Sustainable Development Goals Initiative, to ensure that African countries are able to generate appreciable revenue to fund the Sustainable Development Goals.

FIRS Calls For Increased Collaboration Within African Countries To Effectively Tax Digital Businesses
Mr. Muhammad Nami, Executive Chairman FIRS.

While discussing the needs of the West African region that require Technical Assistance of ATAF, the Executive Chairman FIRS noted that there was a need for capacity building of members in respect of Base Erosion and Profit Shifting Actions by Multinational Corporations, as well as on the taxation of the digital economy.

“It is crucial for the ATAF Technical Assistance to look towards improving the capacity of member country’s tax administration, through the digitisation of operations. Also, critically needed by tax authorities in the West African region is the development of Data Analytics intelligence expertise and the use of research tools that are required for taxation in a modern economy,” he highlighted.

Mr. Nami further urged the African Tax Administrators Forum to organise peer-to-peer knowledge sharing sessions between beneficiaries of the Technical Assistance programmes, while also intensifying on its technical assistance on international tax rules, particularly in the areas of tax treaties, transfer pricing, and exchange of information.

The African Tax Administrators Forum Technical Assistance (ATAF-TA) Programme aims at helping members build sustainable and efficient tax systems while achieving its strategic plans to increase domestic resource mobilisation, target the development of African expertise and support Africa’s effective voice in the international tax environment.

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“With Cooperation, We Can Improve Revenue Mobilization For Our Two Nations”- Nami Tells Niger Tax Authority

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With Cooperation, We Can Improve Revenue Mobilization For Our Two Nations

With Cooperation, We Can Improve Revenue Mobilization For Our Two Nations – Nami Tells Niger Tax Authority

Olushola Okunlade Writes

The revenue mobilization of Nigeria and the Niger Republic can be improved if the revenue authorities of both countries work together to deepen their relationship, share tax information and engage in mutual administrative assistance, Muhammad Nami, Executive Chairman of the Federal Inland Revenue Service (FIRS) stated.

Nami stated this while receiving his Niger Republic counterpart, the Director-General of the Niger Tax Authority, Mallam Ousmane Mahamane and his delegation at the Headquarters of the FIRS, during a cooperation visit to the Service yesterday.

With Cooperation, We Can Improve Revenue Mobilization For Our Two Nations
FIRS Executive Chairman, Muhammed Nami, receives in the audience a delegation from the Republic of Niger Tax Authority, led by the Director-General, Mal. Ousmane Mahamane, at FIRS Headquarters, Abuja. 22nd March 2022. Other members present are Dan Inga Alzouma – Director of Large Companies, Garba Mahamane – Director of Investigations and Tax Control, Zakari Ali Issoufou – Technical Advisor of Dgi, Mal Ousmane Mahamane – Director General Tax, Malam Lawali Mahaman – Head of Reforms and Programs Unit, Mahamadou Soumaila – Head of the Professional Tax Training Center, Konate Issoufou Mamadou Lamine – Head of Public Relations and Protocol, Adamou Barke Doka Maman Sani – French-English Interpreter and Bello Yahaya Bello – Political and Economic Desk Officer.
With Cooperation, We Can Improve Revenue Mobilization For Our Two Nations
FIRS Executive Chairman, Muhammed Nami, receives in the audience a delegation from the Republic of Niger Tax Authority, led by the Director-General, Mal. Ousmane Mahamane, at FIRS Headquarters, Abuja. 22nd March 2022. Other members present are Dan Inga Alzouma – Director of Large Companies, Garba Mahamane – Director of Investigations and Tax Control, Zakari Ali Issoufou – Technical Advisor of Dgi, Mal Ousmane Mahamane – Director General Tax, Malam Lawali Mahaman – Head of Reforms and Programs Unit, Mahamadou Soumaila – Head of the Professional Tax Training Center, Konate Issoufou Mamadou Lamine – Head of Public Relations and Protocol, Adamou Barke Doka Maman Sani – French-English Interpreter and Bello Yahaya Bello – Political and Economic Desk Officer.

Recognizing the long-standing relationship and shared culture and languages of the two countries, Muhammad Nami noted that it was important for the FIRS to work with the Niger Tax Authority given the “presence of high-net-worth Nigerian individuals and companies trading in Niger with significant tax implications, which is of great interest to the FIRS.”

The FIRS Executive Chairman also highlighted the working relationship enjoyed by the Service and the Niger Tax Authority in the past, particularly on the community rule on double taxation and transfer pricing.

He stated that there was the need for further cooperation in the areas of sharing of tax information and mutual administrative assistance, especially in the face of an increase in trans-border tax within the context of ECOWAS and AFCFTA.

With Cooperation, We Can Improve Revenue Mobilization For Our Two Nations
FIRS Executive Chairman, Muhammed Nami, receives in the audience a delegation from the Republic of Niger Tax Authority, led by the Director-General, Mal. Ousmane Mahamane, at FIRS Headquarters, Abuja. 22nd March 2022.
With Cooperation, We Can Improve Revenue Mobilization For Our Two Nations
FIRS Executive Chairman, Muhammed Nami, receives in the audience a delegation from the Republic of Niger Tax Authority, led by the Director-General, Mal. Ousmane Mahamane, at FIRS Headquarters, Abuja. 22nd March 2022.

Muhammad Nami used the occasion to share with his Niger Republic counterpart some of the success stories achieved by the FIRS and the contributors responsible for these milestones.

“We have focused on non-oil tax collection and indirect taxes, particularly VAT as well as on the deployment of technology for the automation of FIRS’ processes and procedures for effective tax administration and greater revenue yield, including e-stamping, e-registration, e-filing, e-payment, e-receipt, e-Tax Clearance Certificates, automation of Stamp Duty and VAT, the deployment of VATrac—an automated VAT filing and collection system in the wholesale and retail sectors—and the deployment of a home-grown, integrated tax administration system, the TaxPro Max.

“One of the contributing factors to our improved revenue is the taxation of the digital economy through the implementation of relevant policies, legislation, and administrative processes for the collection of taxes (both income taxes and VAT) from the digital economy. This ensures that Nigeria is able to collect taxes on non-resident companies that derive income from the Nigerian market, without physical presence. This further ensures tax equity for local businesses.” He stated.

The Executive Chairman FIRS also stated that “the Service has evolved into a data centric organization, leveraging on data in revenue forecasting, planning, tax policy formulation and driving compliance and enforcement.”

He also added that one of the contributors to the FIRS successes was the exchange of information it had with other tax authorities, both internally and in other countries as well as the FIRS being a customer-focused institution that has put measures in place to make voluntary compliance easier than ever for taxpayers.

With Cooperation, We Can Improve Revenue Mobilization For Our Two Nations
With Cooperation, We Can Improve Revenue Mobilization For Our Two Nations
FIRS Executive Chairman, Muhammed Nami, receives in the audience a delegation from the Republic of Niger Tax Authority, led by the Director-General, Mal. Ousmane Mahamane, at FIRS Headquarters, Abuja. 22nd March 2022. Other members present are Dan Inga Alzouma – Director of Large Companies, Garba Mahamane – Director of Investigations and Tax Control, Zakari Ali Issoufou – Technical Advisor of Dgi, Mal Ousmane Mahamane – Director General Tax, Malam Lawali Mahaman – Head of Reforms and Programs Unit, Mahamadou Soumaila – Head of the Professional Tax Training Center, Konate Issoufou Mamadou Lamine – Head of Public Relations and Protocol, Adamou Barke Doka Maman Sani – French-English Interpreter and Bello Yahaya Bello – Political and Economic Desk Officer.

Mallam Ousmane Mahamane, the Director-General of the Niger Tax Authority, in his remarks stated that there was an urgent need for international tax cooperation between the two institutions.

He noted that his Tax Authority was seeking a relationship with the FIRS that would cover cross border trade, the oil sector, the telecommunications sector the digitalization of tax procedures, exchange of tax information, assistance with a tax audit, separation of administrative procedures, modernization of tax administration and human capacity development.

He commended the FIRS Executive Chairman, Muhammad Nami for his “outstanding performance” in mobilizing over N6.405 trillion in revenue for the Government of Nigeria.

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