FIRS targets N1.8tn revenue from VAT In 2017

In a bid to increase the revenue base of Nigeria, the Federal Inland Revenue Service (FIRS) has projected a total of N1.8 trillion Value Added Tax (VAT) collections for 2017 fiscal year.

Executive Chairman FIRS, Tunde Fowler disclosed this on Tuesday during his 2017 budget presentation at the Senate Committee on Finance budget defence.

Fowler said the projected revenue from VAT represents an average of 125 per cent and from an actual of N828 billion proposed in the budget.

According to the FIRS boss told the Senate Committee that the achievement of the 2017 budget would be driven by VAT collection.

Said he, “The Service in realization of this responsibility and challenges of doing manual collection, have automated VAT collection for the critical sectors of the economy notably telecommunications, airlines and financial institutions.”

He also disclosed that FIRS had proposed to meet the tax revenue target in line with the projections of in the Federal Government 2016-2018 Medium Term Revenue Framework (MTRF) for 2017 amounting to a total of N4.89 trillion.

Fowler said the budget for oil revenue dropped by 9 per cent over 2016 actual due to low oil price that operated in the year.

On budget parameter, the FIRS boss said that the 2017-projected cost of collection of N153.44 billion is higher than the 2016 approval estimate, which stood at N143.90 billion.

The figure, he said, represent a cost of collection increase of 6.63 per cent on overall projected non-oil revenue including VAT, stamp duties and levy.

He, however, urged the Senate to approve “the surplus budget of N848arising from an expected total revenue of N153.4 billion over expenditure of N152.6 billion.”

Fowler while reviewing the performance of revenue projection in the current fiscal year said FIRS recorded an increase of N224 billion representing an overall increase of 14 per cent in 2017 against the collection performance for the corresponding period in 2016.

He added, “We have therefore achieved 72.93 per cent of our half year target of N2.44 trillion for 2017 as against 74.2 per cent of N2.1 trillion for the corresponding period in 2016.

He put tax collection between January to June 2017 at N1, 782,922,600.000 with variation of N224, 140,900,000 giving 14 per cent increase of the same period in 2016.

He said, “The chairman may note that we attained this collection performance despite several challenges, as we have continued to vigorously pursued our strategies internally while improving collaboration with relevant stakeholders to boost our collections.

“The strategies put in place are on course and progressively yielding fruits. We are hopeful therefore that the efforts being made will translate to significant tax yields before the end of 2017.”

However, the Chairman Senate Committee on Finance, Senator John Enoh, stressed the need for the FIRS to work to achieve approved target.

Enoh noted that with a deficit of over N2 trillion if the Service failed to meet its target, it would impact negatively on the implementation of the 2017 budget.

The Cross River Central lawmaker also mooted the idea of the need for midterm engagement between the committee and the service to block loopholes in any.