Nigeria’s tax committee proposes firs as sole collection agency

In a bid to enhance fiscal governance and optimize revenue collection in Nigeria, the Presidential Committee on Tax Policy and Fiscal Reforms has embarked on a series of meetings to generate recommendations for implementation within the next 30 days. The key proposal on the table is for the Federal Inland Revenue Service (FIRS) to become the sole collector of revenue for Customs and other Ministries, Departments, and Agencies. This move aims to streamline and improve the efficiency of the tax collection process, ultimately leading to increased revenue for the government. Taiwo Oyedele, the Chairman of the Committee, shed light on the structure and composition of the committee, outlining its three main pillars: fiscal governance, tax reform, and revenue transformation, as well as growth facilitation. The committee's membership comprises professionals from various sectors, including the private sector, government institutions, and professional bodies, all working towards the common goal of driving sustainable fiscal and revenue reforms. One of the key objectives within the 30-day timeline is to assess the current state of the tax system, identify quick wins, and lay the groundwork for long-term reforms. Some of the proposed quick wins include the suspension of VAT on diesel to mitigate the impact of fuel subsidy removal and the conversion of some taxes and levies to be paid in local currency to enhance exchange rate stability. These immediate actions aim to address pressing issues and deliver tangible results within a short timeframe. Another significant proposal discussed is the transformation of the FIRS into the Nigerian Revenue Service, consolidating all revenue collection functions under one agency. This move seeks to enhance transparency, accountability, and efficiency in revenue collection across various government entities. While the transition may take time and require legislative changes, the ultimate goal is to create a unified and effective revenue collection system that benefits both the government and taxpayers. Looking ahead, the implementation of proposed reforms, including the comprehensive review of the national tax policy and the upcoming Finance Act, is expected to shape Nigeria's revenue generation landscape. By streamlining tax laws, enhancing revenue administration, and fostering economic growth, the committee aims to boost the country's tax-to-GDP ratio and promote sustainable fiscal practices. Despite the challenges ahead, the commitment to driving meaningful change in Nigeria's tax system is evident, as stakeholders collaborate to navigate complex issues and pave the way for a more robust and efficient revenue framework.