Tax Administrators Must Match The Pace Of Global Technological Advancements — CATA President

Tax administrators must keep up with the dynamics occasioned by disruptive new technologies of the 21st century, and arm themselves with the necessary skills, capacity, and character for effective and efficient tax administration in the fourth industrial revolution age.

This was the position expressed by the President of the Commonwealth Association of Tax Administrators (CATA), and Executive Chairman, Federal Inland Revenue Service (FIRS), Mr. Muhammad Nami in his charge to the 2022 CATA Senior Leadership cohort, during the closing ceremony of the program held at His Majesty’s Treasury Headquarters, London, United Kingdom, on Friday.

Mr. Nami, in his remarks, highlighted that due to technological advancements in actualising human needs, fulfilling social interactions, and conducting commercial activities, the way and manner of tax administration is constantly changing. He thus called for tax administrators to keep up with the times by improving on their skills and competence in line with these changes.

Left-Right: Muhammad Nami, President, Commonwealth Association of Tax Administrators (CATA), and Executive Chairman, Federal Inland Revenue Service (FIRS); Jim Harra, His Majesty’s Revenue And Customs (HMRC) Permanent Secretary and Chief Executive; Mr. Jon Swerdlow, Capacity Building Unit Transparency Lead, HMRC, and Vice Chairman, CATA; Mr Duncan Onduru, Executive Director, CATA.

“The global tax arena is continually changing,” he noted. “The growing reliance on technology for much of basic human needs, social interactions, and business dealings means that the tax turf remains in a state of constant flux.

“The taxman is only able to match the depth and pace of the changes if equipped with relevant, adequate, and up-to-date skills.”

The CATA President praised the Commonwealth association for its investments and contributions through its Senior Leadership Programme, which he noted has helped bridge the capacity gaps of tax officials in member countries.

“I am glad to note that CATA has, over the years, continued to organize the Senior Leadership Programme in order to meet the capacity development needs of tax officials in commonwealth countries. It has become a tradition for CATA to provide participants in this program with top-notch tuition using case studies in a fun-filled environment.

“The 2022 edition did not depart from this tradition.  The classes, according to reports, were very interactive all through the various sessions whether at home, in India or in the UK.

“Without doubt, the capacity of participants to lead themselves, to lead others, and to lead their functional units have been greatly enhanced.”

Quoting the renowned African philosophy of Ubuntu, “I am, because we are,” Mr. Nami urged the twenty (20) participants drawn from senior tax officials in commonwealth countries to put the knowledge and skills they have acquired during the programme into good use for the benefit of their countries, while further calling on the cohort to maintain and sustain the network of colleagues they have met during the programme.

The CATA Senior Leadership Programme is a yearly senior-level Leadership Programme delivered by His Majesty’s Revenue and Customs (HMRC) on behalf of the Commonwealth Association of Tax Administrators. It pools together senior leaders of tax authorities in Commonwealth countries to equip them with the requisite leadership skills to navigate their organisations in a dynamic and complex landscape. The program recognizes the importance of good leadership to result-driven tax administration in the 21st century.

The 2022 edition combined residencies in India and the UK, accompanied by virtual sessions, and work within the domestic tax authorities of participants.

A Memorandum of Understanding between Nigeria’s Federal Inland Revenue Service (FIRS) and the United Kingdom’s His Royal Majesty’s Revenue and Customs (HMRC) was signed on Thursday with the aim of fostering improved collaboration on capacity building between the two tax authorities. 

The two agencies signed the agreement in London, United Kingdom, and was attended by the Executive Chairman, FIRS, Mr. Muhammad Nami accompanied by some members of the FIRS Board and management, and Director at HMRC, Jon Sherman, alongside other members of the HMRC Executive Committee. 

Mr. Muhammad Nami who led members of the Board and management of the FIRS noted that this collaboration was in line with two planks of his cardinal goals for the Service: building a data-centric tax authority and improving the Service’s collaboration and stakeholder relations. 

“I am certain that this relationship would equip our officers with the skills of the 21st century tax man,” he stated.

“Data is the new oil. Its collection, interpretation and consequent application for tax purposes has become crucial if the Service must be ahead of the taxpayer in the times we are in. 

“With increased collaboration between the Service and tax authorities the world over—which is one of the cardinal pillars of this current management—meticulous and purposeful management, as well as strategic interpretation of the information we exchange between each other has become a fundamental element of inter-tax-authority relations.

“These, among several others, form the major areas where we would be collaborating on capacity building with the HMRC.

“We must be a step ahead.” Mr. Nami noted. 

The FIRS boss, who is also the President of the Commonwealth Association of Tax Administrators (CATA), further explained that with this collaboration, officers of the Service will be better equipped to improve tax revenue collection and in turn provide the government with the much-needed resources to cater for Nigerians. 

Commenting further on the collaboration, David Yellowly, Head of Capacity Building at the HMRC emphasized that “the MoU between the Nigerian and UK revenue authorities would see the two countries collaborating on Capacity Building, particularly on issues surrounding Country-by-Country Reporting Standards, Transfer Pricing, Exchange of Information, Data, and Audit in the Oil and Gas industry.”

As Executive Chairman of the Federal Inland Revenue Service (FIRS), Mr. Muhammad Nami has engendered numerous collaborative efforts with tax authorities domestically and across the world, in line with his agenda of improving stakeholder relations for improved tax administration. 

In February this year, the FIRS signed an MoU with the Lagos State Inland Revenue Service (LIRS) for collaboration on Joint Tax Audit, Exchange of Information, and Capacity Building. 

…“We will carry out joint audit and investigation as a team – Nami

Olushola Okunlade Writes

The Federal Inland Revenue Service (FIRS) on Monday signed a Memorandum of Understanding (MoU) with the Lagos Internal Revenue Service (LIRS) where the two tax authorities would collaborate on joint tax audit, investigation, and automatic exchange of information.

The MoU signing ceremony which took place at the State House, Marina, Lagos State, Monday was executed by the Executive Chairman, FIRS, Mr. Muhammad Nami, and the Executive Chairman, LIRS, Mr. Ayodele Subair, and was witnessed by the Honorable Minister of State, Budget and National Planning, Prince Clem Agba as well as the Lagos State Governor, Mr. Babajide Sanwo-Olu.

The MoU which establishes a joint FIRS, LIRS Audit, and Investigation team obliges the two tax authorities to share relevant information that would assist both parties in their tax administration and enforcement roles, while also providing for capacity building between both authorities. 

Speaking during the ceremony, the FIRS Executive Chairman noted that the cooperation would enable the two authorities to work as a team to achieve these objectives.

“We will carry out joint audit and investigation as a team; we will also conduct an automatic exchange of information for gathering data for the purpose of tax administration. With that information, we would be able to carry out tax administration seamlessly.

“In addition to that, what we are going to introduce administratively because of our joint operation, is to ensure that we are able to implement presumptive tax regime as far as issues of tax administration are concerned.

“But that is going to happen after we are done with the regulation we are putting together with the Ministry of Finance, Budget and National Planning, which the Honourable Minister of Finance would issue in due course.

“The presumptive tax would be for the purpose of Personal Income Tax and also Ground Rent administration in Lagos State.

“Another key issue I want to emphasize is capacity building. There are certain things we know as FIRS and would like to share with the State Inland Revenue Service. And there are also areas of specialization you have that we expect you to share with us through capacity building.

“The major objective of this collaboration is to raise enough funds for Lagos State government and the Federal Government to be able to fund their budgetary requirements,” the FIRS boss stated.

In his message to the people of Lagos, Mr. Nami stated that “civilisation globally does not happen by accident,” but that “people or citizens of various jurisdictions, states, and countries globally make it happen through the taxes they pay.”

Mr. Nami explained that without funds received by the government through taxes, governments all over the globe would not be able to provide critical infrastructures such as roads, hospitals, internationally rated airports, and schools and be able to cater to the security and safety of their citizens.

He stated that “with this collaboration, we are confident that Lagos State would earn more revenue from taxes, and be able to deliver to Lagosians a 4th Mainland Bridge, a Lekki International Airport — which it has already conceived — and other critical infrastructure.

“I appeal to the Lagos State Government to continue to give Lagosians—particularly taxpaying residents—value for the taxes they pay.”

The Lagos State Governor, Mr. Babjide Sanwo-Olu in his remarks stated that this collaboration commenced over a year ago with the intention to improve the fiscal space of the country.

He noted that the country’s tax-to-GDP ratio, at around six to eight percent was unimpressive and unacceptable, stating that other nationals within the Sub-Saharan region are doing better.

“Other nations even within the Sub-Sahara region are doing between 14 to 15 percent. If you talk about developed countries, they are doing 35 to 40% and that is what makes them developed countries because indeed, it is really an avenue for you to support your government and hold them accountable.”

Mr. Sanwo-Olu noted that with this collaboration, the State was on track to rise above its N1.7 trillion to within the region of four to five trillion Naira.

The Honorable Minister of State, Budget and National Planning, Prince Clem Agba commended the two tax authorities for this landmark agreement and appealed to other states to follow suit.