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The Chairman of the Federal Inland Revenue Service (FIRS), Zacch Adedeji, has justified the exigency of the four fiscal policies and tax reform bills for the service, recently introduced by President Bola Tinubu.
The bills presented in the House of Representatives include those seeking to repeal the FIRS Act and establish the Nigeria Revenue Service and the Joint Revenue Board Establishment Bill, intending to create a tax tribunal and a tax ombudsman.
Others are the Nigeria Tax Bill 2024, which is expected to provide the fiscal framework for taxation in the country, and the Tax Administration Bill, which will give a clear and concise legal framework for all taxes in the country and reduce disputes.
Speaking at a meeting with the House Committee on Finance on Wednesday, Adedeji said the proposed legislation intended to refrain from increasing taxes or introducing new ones.
He also said the new fiscal policies and tax reform bills were not aimed at merging any government agency or saddling it with the responsibility to collect taxes, and they would not lead to job losses.
According to the FIRS chairman, the new laws will harmonise all tax laws scattered in different legislation, which has reduced the ineffective performance of tax collection.
“We want to harmonise all the tax laws because we have tax laws scattered in different tax laws and different establishment laws passed. The implication is the diversity of taxes that people talk about because each agency with tax law must implement that tax law.
“No agency is superior to the other, and you cannot ask one agency not to carry out the order. So, Mr President saw that this was not good for the economy, and the only way to do that was to harmonise all the tax laws and have them in one place.
“The other reason is to organise the fiscal framework in the country. As we stand today, there is no law anywhere actually to regulate or monitor cryptocurrency. We are in a global community, and there is no way we can exclude ourselves from what is happening globally.
“One of the things we also consider is efficiency in government spending. Another principle is to improve the transparency and integrity of revenue collection. There is nothing we will do other than understand the laws so they will be straightforward to comply with.
“We also want to complete our tax laws to represent our current realities. We currently use the tax integrity test in 1939 when there was no internet or online shopping.
“To align ourselves with current realities, it is the wisdom of Mr. President that all these bills be implemented. We also want to align ourselves with international standards.
“So, to align ourselves with the international standard and attract investment into Nigeria, Mr. President presented these bills.
It is also aimed at broadening our tax laws. Mr President has said he is not interested in taxing poverty and inflation.
“We will never increase either the rate or the number of taxes. The president believes that our current taxes should be harmonised, and then we should have less than two digital types of taxes. This is what has been put together in the bills sent to the House,” he added.
Adedeji explained that one of the bills is aimed at having the Nigeria Tax Act, which will harmonise all tax laws in the country and put them in one book to reduce the diversity of taxes.
He said the Nigeria Tax Administration Act would harmonise the administration of all taxes, spell out what tax should be paid at “what time it should be paid, and ensure uniformity. So, people will not be moving from one place to another seeking to comply.”
Adedeji noted that the Nigeria Revenue Service Act, which seeks to repeal the FIRS Act, will bring the service to where it is already, saying, “Today, you call us Federal Inland Revenue as if we only collect money for the federal government or only collect cash in Nigeria.
“It was like that when the service was established, but today, one of the revenues we collect is VAT, and 85 per cent of this VAT goes to the states. So what we are doing is not in line with what you call us.
“Today, we collect online charges for Jumia, Google, and others. As Nigeria Revenue Service, we can collect. Any revenue, whether in Nigeria or outside Nigeria, we can collect it.”
On the Joint Revenue Board, he said, “We need a strong legal framework through which we can resolve amicably when there is a conflict between the states and local government as far as revenue generation and sharing is concerned.”
The Committee’s chairman, Hon. James Abiodun Faleke (APC, Lagos), said the purpose of the interface was to give members firsthand information on the bills’ necessity so that they can make informed contributions when the bills come up for second reading.
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