FIRS targeting N10tr revenue in 2022 – Nami

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The Federal Inland Revenue Service (FIRS) is targeting N10.1 trillion revenue in the 2022 financial year.

From the sum, the Federal Government is expected to get N2.053 trillion, while the balance will go to states and local councils.

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According to FIRS, the Petroleum Industry Act (PIA), which has just been signed, will negatively affect the revenue government expects from the Petroleum Profit Tax (PPT), next year.

Chairman of the agency, Muhammad Nami gave the disclosures on Wednesday, during the 2022-2024 Medium-Term Expenditure Framework and Fiscal Strategy Paper (MTEF & FSP) interaction with the House of Representatives Committee on Finance as well as Ministries, Departments and Agencies (MDAs) at the National Assembly Complex, Abuja.

 

FIRS generated N4.95 trillion against budgeted N5.076 trillion (representing about 98 per cent), he noted, adding that the non-oil component contributed N3.435 trillion and oil aspects raked N1.515 trillion.

He said the cost of collection (four per cent net of two per cent Nigerian Customs Service VAT) of N130.45 billion was achieved against the budget of N180.76 billion to fund the three operational expenditure heads for the year.

On the impact of the PIA on revenue generation, the chairman said: “We expect that with the new PIA, there are some reconciliations that will be carried out that might affect the projections for 2022. We expect new expenditure that will be rolled over to the new regime. So, we are trying to adjust those expenses for 2022.

The lawmakers asked FIRS to include Twitter and Facebook as part of their assumptions to increase revenue as well as extend its tax drive to the informal sector, which is a veritable area to get more money to finance the budget deficit, instead of borrowing.

FIRS also disclosed that a proposal has been sent to the Federal Government for a law on road tax.

At the public hearing yesterday, a member of the House committee from Osun State, Afolabi Olalekan, asked Nami to explain what FIRS put in place to tackle tax evasion by people in the informal sector.

“What is your agency doing to extend your tax drive to the informal sector, because I believe the informal sector is a veritable area where we can get a lot of money, especially this period that the country is relying on borrowing to finance budget deficit,” he asked.

Responding, Nami said FIRS was working on several measures to ensure that the informal sector paid taxes to the Federal Government. The measures include the introduction of road tax, he added.

Nami said when FIRS and the Federal Government finalises the framework on road tax, the proposed legislation would be sent to the National Assembly.

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