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Presidential Committee Pushes For FIRS To Collect Revenues For Customs, Other MDAs

The Presidential Committee on Tax Policy and Fiscal Reforms has recommended a change in revenue collection procedures for the Federal Government.

President Bola Tinubu inaugurated the committee headed by Taiwo Oyedele on Tuesday at the Presidential Villa, Abuja.

The committee chairman, Oyedele, said the Nigeria Customs Service and 62 other Ministries, Departments, and Agencies (MDAs) should stop direct revenue collection activities.

Oyedele disclosed this during an interview on Channels Television’s Sunrise Daily breakfast program on Wednesday.

He said the Federal Inland Revenue Service (FIRS) is now responsible for revenue collection, noting that this decision stems from concerns regarding Nigeria’s relatively low tax revenue collection rates on a global scale.

“Ironically, our cost of collection is one of the highest. And the reason for that is that we’ve got all manner of agencies. The Federal Government alone, we have 63 MDAs that were given revenue targets last year, no; actually, in the 2023 budget,” Oyedele stated.

“And two things that would come up from that: on one hand, these agencies are being distracted from doing their primary function, which is to facilitate the economy. Number two, they were not set up to collect revenue, so, they won’t be able to collect revenue efficiently.

“So, move those revenue collection functions to the FIRS. It has two advantages: the cost of collection and efficiency will improve, these guys will focus on their work, and the economy will benefit as a result.”

Oyedele clarified his stance, stating that agencies like the Nigeria Customs Service should “focus on trade facilitation and border protection,” and likewise, agencies like the Nigerian Communications Commission (NCC) should just regulate telecommunications rather than collect revenue.

“It can be your revenue, and someone else can collect it for you. There will be more transparency because you see what is being collected and is accounted for properly. It is also a way of holding ourselves to account as to how we spend the money we collect from the people,” he added.

The committee’s main objective, according to the chairman, is to make sure that money that is due to the government is efficiently collected, despite opposition from stakeholders who currently profit from the process.

Oyedele described the Treasury Single Account (TSA) as a positive step in the right direction but said it has not been fully developed.

He stated that the TSA will help his committee’s work, but there is more to do to maximise the initiative, stating that the presidential committee would look into excess bank charges.

Oyedele added that while businesses currently pay up to 65 to 70 levies and taxes, the committee wants to cut that number down to around 10.

The chairman also expressed concern about Nigeria’s tax gap, estimated at around N20 trillion, as many members of the elite evade paying the exact taxes they should remit to the government.

He noted that a lot of people are not tax compliant, particularly the middle class and the elite; some of them are in the tax net with one or two fingers, noting that some pay a thousand naira as tax when they should have paid N10 million.

Oyedele added that the committee’s overarching plan includes the repeal of onerous taxes that hinder business activities, with the ultimate goal of collecting more revenue.


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