Nigerian govt targets $1bn from new tax schemes

Nigerian govt targets $1bn from new tax schemes
March 16 20:56 2017

The federal government is targeting an estimated revenue of $1 billion from the proposed Nigeria Voluntary Asset and Income Declaration Scheme, ‎chairman of the Federal Inland Revenue Service (FIRS), Mr. Babatunde Fowler, ‎said on Thursday.

Addressing State House correspondents at the end of the National Economic Council (NEC) meeting in Abuja, Fowler said the scheme takes off on May 1 this year.

He said the scheme would run for up to six months and would offer a window for those who have not complied with extant tax regulations to remedy their positions.

He said the scheme provides limited amnesty to enable voluntary declaration and payment of liabilities, and would have incentives to encourage early ‎participation.

He said under the scheme, taxpayers would be allowed up to three years to settle their liabilities.

Fowler said the Federal Inland Revenue Services (FIRS) is targeting an increase in tax contribution to the Gross Domestic Product (GDP) to 18 per cent by 2020 through Voluntary Asset and Income Declaration Scheme (VAIDS) approved by the National Economic Council.

He said a conservative revenue of US$1 billion is expected to be generated from

the scheme, adding that the VAIDS scheme would embrace all federal and states’ taxes such as Companies Income Tax, Personal Income Tax, Petroleum Profits Tax, Capital Gains Tax, Stamp Duties, Tertiary Education Tax and Technology Tax.

He said the VAIDS scheme is expected to simultaneously generate revenue and encourage investment and economic activity as only 214 individuals in the entire country pay N20 million or more in tax annually.

The FIRS boss said only 14 million Nigerians out of the 40 million eligible taxpayers

currently pay tax, adding that under-payment of tax has been principally perpetrated by multinational companies and high net worth individuals, thereby making Nigeria a country with the lowest non-oil tax to GDP at six per cent.

Also speaking, Minister of Finance, Mrs Kemi Adeosun, said the council was briefed on the balance in the Excess Crude Account (ECA) as at March 15, 2017, which stands at US$2,45,864,724.59.

The minister said the Revenue Mobilisation, Allocation and Fiscal Commission (RMAFC) has recently approved N39,613,282,870.69 for disbursement to some states.