The Federal Inland Revenue Service (FIRS), said yesterday that the issue of multiple taxation in Nigeria has been resolved with the amendment of Section 68 of the FIRS Establishment Act by the Finance Act 2021.
FIRS Executive Chairman, Muhammad Nami, who revealed this in his keynote speech at KPMG’s webinar on Nigeria’s 2022 Budget and 2021 Finance Bill, noted that taxpayer complaints regarding several government agencies demanding the tax payment had been processed.
He said multiple taxation was never in line with national tax policy direction and caused confusion for taxpayers and increased their cost of compliance.
“However, the amendment of Article 68 of the FIRS Law by the Finance Law 2021 made it clear that the FIRS is the sole agency responsible for the assessment, collection and enforcement of taxes. such, taxpayers should expect a streamlined tax administration regime in the future,” Nami said.
He said that the FIRS will use the instrument of the 2021 budget law, working with taxpayers and key stakeholders to ensure adequate financing of the country’s budget and raise necessary financing for national development.
He also noted that the law provides a framework for fair treatment, automation and deployment of ICT infrastructure, a single agency for tax collection and taxation of the digital economy, among other key interventions to improving tax administration in the country.
On fair dealing, Nami explained, “In the past, situations abounded where certain goods or services brought into Nigeria by non-resident businesses, especially to consumers (B2C), were not subject to VAT. This raised the issue of fairness, as goods and services offered by domestic companies are subject to VAT.
“With the amendment of Article 10 of the VAT Law and our publication of the “Guidelines on the simplified VAT compliance regime for non-resident suppliers”, there is now a mechanism for the application of VAT on such goods or services, offering the same tax treatment to local and foreign supplies.
“Similarly, businesses deriving revenue from Nigeria without a physical presence can now be assessed, like other businesses with a physical presence, on a fair and reasonable percentage of their turnover in accordance with Section 30 of the CITA.”
Regarding the automation of tax processes, the FIRS Executive Chairman noted that “with the amendment of Article 25 of the FIRS Establishment Law, the service can now deploy technologies that are proprietary or developed by third parties for tax administration. Those who may still obstruct the achievement of this target will now be subject to a daily fine of 25,000 naira.
He added: “With the extension of secrecy and confidentiality requirements to other people, such as service providers, vendors and service consultants, taxpayers’ fear of secrecy and confidentiality is further alleviated. of their business and other information.”
Nami said the service will deploy compliance and enforcement strategies and leverage intelligence and strategic data mining and analytics to provide intelligence and information to enhance its audit functions and survey, while reducing the prevalence of tax abuse in the management of incentives in the country.