Thursday, September 21, 2023
Thursday, September 21, 2023

FIRS targets 18% tax to GDP ratio by 2026

by admin
FIRS targets 18% tax to GDP ratio by 2026

The Federal Inland Revenue Service (FIRS) has said that it will raise Nigeria’s tax to Gross Domestic Product (GDP) ratio from the current 10.86 per cent to 18 per cent in three years.

This, it said, would help to reduce the nation’s reliance on borrowing and ensure financial sustainability.

The acting Executive Chairman of FIRS, Zacchaeus Adedeji, said this yesterday in Abuja during the handover ceremony.

Last Thursday, President Bola Tinubu asked Muhammad Nami to proceed on three months pre-retirement leave, while announcing Adedeji, his Special Adviser on Revenue, as replacement in acting capacity.

Speaking during the handover event, Adedeji said the service under him would align with the president’s Fiscal Policy and Tax Reforms Committee to “shape a prosperous fiscal landscape that empowers our nation’s growth and development.”

He further said, “I pledge to maintain an open-door policy, actively engaging with stakeholders to collaboratively construct a tax administration that we can all take pride in. Together, we will build an institution that serves as a beacon of excellence.

“Our aspiration is audacious – to surpass Africa’s average tax-to-GDP ratio of 16.5 per cent and achieve an impressive 18 per cent within three years. By doing so, we aim to reduce our nation’s reliance on borrowing and ensure financial sustainability.

“Presently, we confront a pressing revenue crisis, with a staggering 96 per cent of government revenue being funneled into servicing our debts. This stark reality necessitates swift and resolute action on our part. We cannot afford to delay; we must act decisively to reverse this concerning trend.”

In his farewell address, Nami expressed appreciation to ex-President, Muhamnmadu Buhari and President Tinubu for allowing him to serve the country for almost four years.

Nami said he was able to collect tax of more than N8trn in eight months and would have set a new record of over N12trn at the end of the tax year.

He further said, “The service is on track to set yet another record in 2023 as it collected over N8.5trn (cash) from 1st January to 14th September and assessed, reconciled and recovered over N4trn outstanding tax liabilities and sequestered funds from NNPC on behalf of the federation.

“This total sum of over N12trn is exclusive of amounts invested by our taxpayers under the Road Infrastructure Tax Credit Scheme and tax implications of waivers by government from January, 2023, to date.”

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