Mr. Olanrewaju Ajogbasile of the Nigeria Governors’ Forum (NGF), has said that the lack of trust between the government and the citizens has continued to be a drawback to tax collection in Nigeria.
Ajogbasile, said this at a one-day capacity training for members of the Finance Correspondents Association of Nigeria Friday in Abuja.
Speaking on the theme: “New Approaches to Tax Administration in States”, Ajogbasile added that it has made tax collection difficult as many are unwilling to pay because they do not trust as their monies will be used judiciously.
He also pointed out that worsening insecurity and currency depreciation has affected the business environment and consequently, productivity and income to be taxed.
With revenue from Nigeria’s main source of revenue –oil-on the decrease, experts say that tax revenues are becoming essential for state governments in maintaining fiscal sustainability, especially with the boom and bust cycles of the Nigerian economy.
He further added that “lack of standard operating procedures and processes guiding operations of SIRSs and their zonal/area offices; proliferation of private contractors/consultants for same revenue items; and weak collaboration between state and local governments on joint collections, among others.
To address this imbalance, Ajogbasile said several reforms have been introduced by National and sub-National governments, and according to him, it has yielded results.
“Improved collaboration between SIRSs, trade unions, and associations; establishment of tax appeal tribunals to improve turnaround for closing out tax disputes.
Engagement of mobile money agents for informal sector revenue collection, where the SIRS lacks reach.
However, this is done under a performance contract and driven by a technology-enabled process to ensure transparency in the collection.
Passage of Consolidated State Revenue Codes by States to address the multiplicity of taxes; Implementation of tax relief in response to COVID-19.
The prohibition of tax consultants for the assessment and collection of Personal Income Tax – where the SIRS has the competence and reach.
Passage of Consolidated State Revenue Codes across 26 States to address the multiplicity of taxes; innovative IGR mobilization strategies for improving/sustaining nominal IGR growth – Presumptive tax, HNWI units, USSD offline payment, risk transfer strategies; Implementation of structured tax relief in response to COVID-19.
The prohibition of tax consultants for the assessment and collection of Personal Income Tax; Improving property records for effective property tax administration.
Publication of annual budgets and audited financial statements to promote transparency and accountability, and citizens’ budget and citizens accountability report.
Benjamin Umuteme,
Blueprint News