By Adedapo Adesanya
The Federal Inland Revenue Service (FIRS) has raised an eyebrow over what it called the systemic abuse of the pioneer incentive scheme instituted by the federal government, saying it is leading to tax revenue leakages for the three tiers of government.
This was made known by the Executive Chairman of the tax body, Mr Muhammad Nami, during a meeting with State Commissioners of Finance at the Revenue House, headquarters of the FIRS in Abuja.
In a statement signed by the Director, Communications and Liaison Department, Mr Abdullahi Ahmad, the FIRS reiterated its vow to plug this tax revenue leakage in order to generate more revenue for the Nigerian government.
Mr Nami stated that tax revenue accounts for nearly 70 per cent of what was shared at the last FAAC meeting and lauded the collaboration between the service and the State Commissioners of Finance, saying this is key to bringing about increase in tax revenue.
He said without this collaboration, it would be difficult for the government to meet its obligations to the citizenry in such areas as infrastructure development and salary payment, which could lead to social dislocation.
The Executive Chairman emphasised the need to diversify the economy in order to create more sources of taxable income and increase tax revenue for the nation.
He charged the states to focus on other forms of taxes like the Stamp Duty which he described as “the black gold” which has been ignored before now.
He also charged all Ministries, Departments and Agencies (MDAs) to carefully deduct withholding tax from contracts at the point of payment.
Mr Nami also solicited the states’ support in terms of taxpayer sensitization campaigns and education, stating that rental obligation was incomplete without the payment of stamp duties. He emphasised that if these initiatives were pursued at both local and state levels more revenue would be generated.
The Coordinating Director, Tax Operations Group, FIRS, Mr Femi Oluwaniyi, who expressed appreciation to the state commissioners of finance for their support so far in revenue generation for the Federation, decried the indiscriminate tax waivers and incentives granted to undeserving companies, which he stressed has impacted negatively on revenue generation.
Mr Oluwaniyi disclosed that the FIRS has discovered that pioneer status certificates had been issued to companies that were not pioneers of their fields in the real sense, hence undeserving of such status.
He stated that this development has led to the loss of considerable tax revenue to the three tiers of government.
However, the FIRS hinted that it was auditing its findings with a view to pressing for the cancellation of pioneer certificates issued to undeserving companies in violation of the law.
The FIRS stated that pioneer status otherwise granted outside the law would not enjoy tax relief regardless of the certificate issued to them and owners of such certificates were requested to regularize their tax positions otherwise sanctions shall apply in accordance with the law.
Speaking on behalf of the delegation, the Benue State Commissioner of Finance, Mr David Olofu assured that the states were looking forward to working closely with FIRS in order to generate more tax revenue for the country.
Modupe Gbadeyanka