The Federal Inland Revenue Service (FIRS), generated the sum of N2.11 trillion as revenue from January to July this year – through tax collection.
This is contained in a progress report of the FIRS for the period under review obtained by the News Agency of Nigeria (NAN) on Monday, showing the revenue performance and impact of the new tax regime.
The aggregate revenue projected in the 2017 budget is N4.94 trillion, out of which oil revenue is expected to contribute N1.98 trillion.
This is based on an estimated crude oil production of 2.2 million barrels per day at an exchange rate of N305 to a dollar.
Non-oil revenue for the year is projected at N1.37tn, which represents about 28 per cent of the budgeted revenue.
Independent revenues, various recoveries and mining will account for the balance of about N1.58 trillion.
A breakdown of the report showed that the FIRS collected N720.28 billion as Petroleum Profit Tax from January to July this year, while the Value Added Tax revenue collected in the same period was N548.22 billion.
The Federal Government had also collected the sum of N679.9 billion as Company Income Tax and N91.4 billion as Education Tax in the first seven months of the year.
The report also showed that the consolidated tax revenue for the first seven month of the year was N62.3 billion, which has already superseded the N59.8 billion generated from the area in the entire 2016 financial year.
Also, the service recorded success in boosting its collection of the National Information Technology Development Fund levy, which went from N6.75 billion in 2016 to N9.87 billion in the first seven months of 2017.
A further analysis of the report showed that the FIRS generated more money from taxing the non-oil sector compared to the oil and gas sector.
The report showed that non-oil tax revenue contribution was at 65.9 per cent, while oil and gas contribution to revenue so far was at 34 per cent.
According to the report, the improvement recorded so far is due to the steps taken by the service to increase tax collection.
The report stated, “The FIRS has adopted e-services as a medium to achieving innovation, convenience and transparency of its operations so as to ensure that every effort is made to improve efficiency in collection and tax administration.
“A 45-day window from October 5 to November 2017 was given to taxpayers with tax liabilities to come forward and pay 25 per cent of the agreed tax liability, spreading the balance liability, while waiving penalty and interest.
“The FIRS, in collaboration with Corporate Affairs Commission, Central Bank of Nigeria and Nigeria Customs Service, undertook a massive nationwide registration exercise of new taxpayers in 2016. We are also carrying out a sector-by-sector tax audit, which has increased compliance across all tax types and taxpayers’ categories. Over N8bn has been recovered through this.
It added, “Also, the Voluntary Assets and Income Declaration Scheme encourages voluntary disclosure of previously undisclosed assets and income for the purpose of payment of all outstanding tax liabilities to boost revenue collection.
“All this will help improve the low tax ratio from six per cent to 15 per cent by 2020, and curb the use of tax havens for illicit funds flow and tax avoidance.”
According to the report, the service is instrumental to the signing of a Bilateral Taxation Agreement on double taxation on income and capital gains.
Omoleye Omoruyi… an apprentice web/game developer, novelist, sensitive to happenings in the world. Meet him @Lord_rickie on Twitter/Instagram