THE Federal Inland Revenue Service (FIRS) has stated that it recorded a consistent increase in tax collection from the non-oil sectors of the economy in 2021, peaking at 69% from 38% in 2017.
In its 2021 performance update, the FIRS said it collected the sum of N4.396 trillion as non-oil taxes compared to N2,507 trillion collected in 2017. “This feat was made possible due to the adoption of the in-house built TaxPro Max Solution and other strategic reforms implemented by the Service,” FIRS chairman, Muhammad Nami, said in the update.
He noted that the year 2021 was a critical one for tax administration in Nigeria and in line with the law, 2021 corporate income tax revenue was based on business profits of 2020. “In the year 2020, the country entered into economic recession for the second time in 5 years. The recession was caused by a 5-month lockdown occasioned by the Coronavirus pandemic. To compound the economic challenges of Covid-19, business activities were disrupted by the End-SARS protests.
“Due to the recession, many businesses struggled to survive with very few reporting profits. The base for corporate tax was grossly eroded due to losses and business failures. Upon the coming into office of the current Management, FIRS began strategic administrative and operational reforms including implementation of new policies that would improve its capacity to achieve its mandate,” Nami said.
He explained that the deployment of the new automated tax administration system (the “TaxPro Max”) in June 2021 was a game-changer. “With the solution, taxpayers experienced ease of registration, reporting, payment and issuance of Tax Clearance Certificates while the Service experienced greater efficiency in the deployment of resources thereby leading to improved revenue collection,” he said.
