Nigeria loses N17trn to tax waivers
By Tunde Opalana
Nigeria lost N17 trillion to tax waivers within the last years, the Federal Inland Revenue Service (FIRS) has revealed.
The FIRS made the revelation on Monday during its budget presentation session with the Senate Committee on Finance.
Describing the development as unacceptable, the Senate committee ordered FIRS to suspend tax waivers on imports and opt for rebating system instead.
This was just as the chairman of FIRS, Zacch Adedeji who led his team to the presentation, projected a N19. 4 trillion total tax collection for 2024.
Adedeji reiterated his early position that a fresh N2 .7 trillion Tax Credit planned for road construction across the country by the Nigerian National Petroleum Company Limited (NNPCL) should not be entertained.
In his remarks, the chairman of the Senate Committee on Finance, Senator Sani Musa, observed that FIRS’ N19.4 trillion tax revenue target was commendable compared with the N11.16 trillion the agency generated in 2023.
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Senator Musa however, charged the FIRS to raise its 2024 tax revenue target to N30 trillion, saying the target is achievable if the right measures are applied.
“As impressive and encouraging the performance and projections of FIRS are, under your leadership, this committee and by extension, the Senate, on a serious note, urge you to look at the direction of tax waivers being abused with attendant and avoidable losses being incurred on a yearly basis
“Available records show that within the last five years about N17 trillion had been lost by the country to tax waivers. Tax waivers should be suspended and possibly substituted with rebating system,”Musa said.
During his presentation, the FIRS chairman urged the Senate to save Nigerians from multiple taxation, saying the existing 62 different taxes could be reduced to eight.
Adedeji said, “President Bola Tinubu has seen the issue of multiple taxation as a pool of problems. That is why he set up the presidential committee on tax reforms and fiscal policy.
“As of today in Nigeria, we have 62 types of taxes being collected.
“The sad news about it, is that less than eight out of the entire 62, accounted for 97 percent of the collection.
“We are already consulting and engaging the state governments on it. At the end of the day, we won’t have more than eight or nine taxes that the states and federal government would be collecting.”
On the controversy trailing the implementation of Tax Credit Scheme for road construction by NNPCL, the FIRS boss insisted that the N2.5 trillion earlier committed to the scheme must be fully implemented before thinking of any fresh one.
He said, “Regarding tax credit, what I said was that the programme is laudable but that the N2.5 trillion being spent on it by NNPCL should be exhausted before bringing fresh request.
“N2.7 trillion fresh request being made, should not be entertained because all NNPC revenues should not be spent on roads when the Ministry of Works is there.”
