Nigeria Content Online

The
federal government yesterday directed the Joint Tax Board (JTB) and the
Federal Inland Revenue Service (FIRS) to eliminate all forms of
multiple taxations from the country’s tax jurisdiction.

Minister
of State for Finance, Remi Babalola, who gave the directive at the
122nd meeting of the JTB in Abuja, emphasised the need for government
to continue pursuing good tax policy and administration in the country
as a vital part of strong economic management.

Mr.
Babalola listed advantages the country offers investors as a leading
financial centre to include a politically stable environment, a robust
regulatory system with good corporate governance standards, and a
dedicated workforce yet relatively cheap, pointing out that there is
need for the country to justify that recognition in Africa.

“The
country cannot afford to take these advantages for granted. All forms
of double taxation must be eliminated in our various jurisdictions,” he
said. “For the country to secure a position as a financial services
centre, we must strive to have an internationally competitive tax
system.

“Achieving
international competitiveness is not about reducing our tax rates to
the lowest in the world. Rather, we should focus on identifying and
removing barriers to the effective tax administration as well as strive
towards a system that is not only open and transparent, but providing
clarity and certainty, while maintaining integrity.”

All tax payers

Urging
the two institutions to ensure that they capture all predominantly
untaxed, yet potential and eligible taxpaying groups in the country,
the minister observed that the nation’s tax administrators still exist
largely in the era of ‘arm-chair revenue collection’, adding that a
situation where Federal Government employees are under-taxed as a
result of this cannot be justified by any explanation.

“The
expenses of government to the citizens of a great nation like ours, are
like the expenses of management to the joint tenants of a great estate
who are all obliged to contribute in proportion to their respective
interests in the estate. The Board should spare no efforts at
galvanising support for the various tax authorities to reach out and
capture our predominantly untaxed, yet potential and eligible taxpaying
group,” he said.

Effective
administration of the various extant tax policies, according to Mr.
Babalola, will help shape Nigeria’s economic future, improve
productivity and enhance competitiveness, adding that “It will lift our
Gross Domestic Product (GDP) so that Nigerians are better off. It has a
way of fighting the corruption virus in our system and it can deal with
intergenerational issues in a way that ensures a sustainable future.”

Decrying
the persistence of revenue leakages in the system, Mr. Babalola charged
the tax board to put in place measures to block the leakages of revenue
nationwide as well as ensure improvements in the willingness, accurate
declaration of tax liabilities and collection of tax from the populace.

The
board is composed of representatives of the Federal Inland Revenue
Service (FIRS), states internal revenue services/state boards of
internal revenue, as well as revenue agencies like the Nigerian Customs
Service (NCS), Federal Roads Service Commission (FRSC) and the Revenue
Mobilisation Allocation and Fiscal Commission (RMAFC).

Its
chairman, who is also the executive chairman of the FIRS, Ifueko
Omoigui, said the JTB has not only discharged its role in ensuring
uniformity in the administration of personal income tax (PIT) in the
country, providing a forum for speedy resolution of conflicts between
members as well as providing advisory services to government on tax
matters in the last decade, but also facilitating the implementation of
tax reforms, including amendment of tax laws to address current
realities in the system.

Personal income tax

On
alleged introduction of new personal income tax by government, Mrs.
Omoigui denied any such decision, saying any increment in tax is
payable strictly in compliance with the ongoing reforms, adding that
the current ratio of about 6 percent of internally generated revenue
(IGR) to total revenue bears out the reality that 90 percent of the
taxes come from the pay as you earn (PAYE) mechanism.

She
called for the passage of the outstanding tax Bills before the National
Assembly, adding that government should grant increased administrative
and financial autonomy to state internal revenue services, establish
effective statistical database to facilitate future identification and
determination of tax administration-related issues as well as take
steps to curb the menace of multiple taxation at the federal, state and
local government levels in the country.