Zenith Bank BetaLife
Zenith Bank BetaLife
Zenith Bank BetaLife
Zenith Bank BetaLife

The Federal Inland Revenue Service on Thursday disclosed that the non-oil sector contributed about 54 per cent of the N5.32 trillion revenue it generated in 2018.

Babatunde Fowler, FIRS Chairman, disclosed this in Lagos during an interactive forum on Tax Matters with the Manufacturers Association of Nigeria.

Fowler noted that the manufacturing sector and other sectors under non-oil sector have overtaken the oil sector in contributing immensely in terms of revenue generation to the nation’s economic growth.

He said that the Ease of Paying Taxes sub index under the World Bank’s Ease of doing business ranking shows that Nigeria currently ranks 171 out of 190 countries, having moved up 11 places from its 2017 ranking.

According to him, several initiatives were evolved to improve revenue collection and compliance, while reducing the cost of collection.

He said that the agency has lifted the lien placed on tax defaulters bank accounts for 30 days to allow them regularise their tax positions, while apologising to businesses that were wrongfully affected by the accounts freeze.

Fowler criticised the perfidy of businesses who collect Value Added Tax and fail to remit to government, saying era of tax evasion was over.

He said that FIRS in collaboration with the Joint Tax Board and the Small and Medium Enterprises Development Agency of Nigeria forged a partnership to improve the level of voluntary tax compliance by operators in the Micro, Small and Medium Enterprises sector.

Fowler said that to support the growth of the sector, interests and penalties for unremitted taxes were waived for tax defaulters, a proposed special tax regime was being developed and commitment to patronise 40 per cent of locally produced goods.

The FIRS boss pledge its commitment and support to engage more with the private sector, especially manufacturers, in its operation, assessment and development of the nation’s economy.

Earlier, Mansur Ahmed, President of MAN, said that the association aligns with FIRS objective, which was part of the transformation initiatives of the present Administration that seeks to create a more prosperous and diversified economy.

Ahmed said: “This is of significant importance, given the role of manufacturing in the industrial and economic development of our country and the concomitant effect on employment generation, technology acquisition and wealth creation.

“Moving the government’s revenue away from oil dominated foreign earnings to a more predictable sources have the potential to accelerate the country’s economic growth.”

Ahmed commended FIRS’ role in the last three years; acknowledging that revenue from taxes has significantly improved and becoming another credible source of government’s yearly budget funding.

He said: “This is minimizing the vagaries and volatility associated with oil prices at the international market.”

He urged government to widen the tax net rather than increasing the tax rate in taxes and levies which are usually borne by the narrow tax compliant segments of the populace.

According to him, majority of the corporate entities that were tax compliant were mostly manufacturers whose internal system cannot permit avoidance or evasion of tax.

He commended FIRS for its support and understanding in respect of the Value Added Tax exemptions on biscuit and raw materials for the manufacture of diapers.

Ahmed expressed optimism that the forum would strengthen the relationship between manufacturers and FIRS toward boosting economic growth.

Also, Paul Gbededo, Group Managing Director, Flour Mills Ltd., urged FIRS to reduce the nation’s Company Income Tax from its present 30 per cent toward stimulating investment and easing the business environment.

Gbededo, who is the Head of MAN Economic Policy, said that strict compliance to tax payments was a critical part of an organisation’s Corporate governance system, saying manufacturers were law abiding citizens.

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