With earnings from oil exports declining steadily by the day as a result of low global crude oil prices, Federal Inland Revenue Service (FIRS), Chairman, Tunde Fowler, said on Monday the Federal Government was now ready to fund annual budgets from non-oil revenue sources.
During the Federation Accounts Allocation Committee (FAAC) meeting last week, 70 per cent of the over N559.03 billion shared among the three tiers of government for June came from non-oil revenue sources.
Apart from a total of N279.16 billion realised as non-mineral revenue, another N67.4 billion came from value added tax (VAT), in addition to increases in revenue from company income tax (CIT), import duties and royalties.
Mr. Fowler, who is also the Chairman, Joint Tax Board (JTB), hailed the development, describing it as unprecedented.
“It was the first time in 2016 that the Federal Government shared over N500 billion among the three tiers of government during the Federal Accounts and Allocation Committee (FAAC) meeting,” Mr. Fowler said.
“We are proud of the development and we tell ourselves that this is the time to fund the budget of the Federal Government from non-oil sources.”
Mr. Fowler was speaking in Abeokuta when he led 36 Chairmen of the State Boards of Internal Revenue (SBIRs) to the Ogun State governor, Ibikunle Amosun, shortly after declaring open the 135th meeting of the JTB.
“Whatever you (SBIRs), Nigeria Customs and others did last month that ensured that we (Federal, States, shared over N500 billion at FAAC—(the Federation Accounts Allocation Committee), please continue to do it. It is good for the Federal Government. It is good for states. It is good for Local Governments. It is good for the nation,” Mr. Fowler said.
The FIRS Chairman said although tax revenue collection was seasonal, a combination of new taxpayer registration drive, tax education and engagement through the establishment of the federal engagement and enlightenment tax teams (FEETT) was beginning to yield results.
He said the audit of five key sectors, namely banks and the financial sector, aviation, power, telecoms and oil and gas would also boost the country’s revenue generation profile.
The FIRS, he said, has also added over 700,000 new corporate accounts in the system since he assumed office, adding that Nigeria has a cumulative figure of 10 million registered taxpayers, in addition to the number of taxpayers of SBIRs and and the FIRS.
“The JTB has given itself a target to register at least 10 million additional taxpayers by December 31, 2016. We have commenced tax enforcement too. We are happy that the efforts of the FIRS in collaboration with revenue stakeholders are already yielding positive results,” he said.
Mr. Fowler said the FIRS and SBIRs have resolved to work together to register more taxpayers, across states, data sharing, exchange of information, joint audits to improve efficiency and tax yields from audits, capacity building through joint training programmes and exchange of personnel.
To ensure the implementation of the collaboration framework, FIRS has requested the approval of state governments for the automation payments process on taxable transactions to enhance the deduction, at source, particularly of withholding tax and VAT.
Mr. Fowler thanked Mr. Amosun for being the first state governor to approve FIRS’ request on automated deduction and remittance of VAT and Withholding Tax from the point of payments to contractors in states.
For Governor Amosun, the ability of the Federal Government to collect more than N500 billion last month proved the country could generate more if everyone was determined to explore other sources of revenue apart from oil.
“It has come to a point we should say, okay, let us leave oil aside. Let us face non-oil sources. All hands must be on deck to grow our tax revenue. We must find a way of bringing the rich people into the tax net,” the governor said.
The JTB, established in 1961, is the umbrella body for State and Federal tax authorities in Nigeria, to promote uniformity and harmonisation of Personal Income Tax Administration across the country.