The Senate, on Tuesday, passed a bill for a second reading to amend the Federal Inland Revenue Service Act to regulate the processes of granting corporate tax holidays, import duty waivers and investment incentives to investors and businesses in Nigeria.
The bill, sponsored by Yahaya Abdullahi, seeks to whittle down the powers of the Federal Government to unilaterally grant tax holidays and incentives to businesses.
It seeks to create a new section (9) in the FIRS Act to mandate the FIRS to secure due legislative approval of the National Assembly in granting of new or renewal of corporate tax incentives and waivers.
According to Abdullahi, “Such requests and applications for parliamentary approval shall stipulate clear conditions and justification for granting tax waivers and investment incentives.
“All, or any other enactments specific to cases of granting investment incentives and tax waivers to businesses, institutions and individuals that conflict with the provision of this Act, shall be deemed, not applicable.”
Senator Abdullahi, in his lead debate, said the bill had become imperative due to leakages and loopholes in tax collection and remittances to the government amid revenue shortfalls and high debt profile.
He expressed worry that in the last five years, the country had not been able to achieve its revenue targets.
Figures from the Debt Management Office showed that N3.9tn was realised out of the targeted revenue of N7.2tn in 2018.
In 2019, the target was N7tn while actual revenue collected was N4.12tn.
The sum of N5.4tn revenue was targeted in 2020 but N3.9 trillion was received, while in 2021, the target was N6.4tn while N4.64tn was received.
Read Also: Night Of Excellence: MARAN Holds 34th Anniversary On Friday
In 2022, targeted revenue was put at N5.82 trillion while actual revenue received was N3.66 trillion.
The lawmaker expressed concern that debt service was consuming over 90 per cent of the government’s revenues up from 32.7 per cent in 2015.
He said, “If this trend of relentless reliance on increasing public debt to finance the budget continues without corresponding rise in revenues, the country shall slide into distress and insolvency.
“With petroleum revenues dwindling into insignificance, we must rise to rationalise the system of tax administration by blocking loopholes and tax evasion, and ensure utmost efficiency in tax management.
He added, “In early 2020, the FIRS reported a loss of N 1.3 trillion to tax waivers in five years. And this was in just three sectors of the economy. Similarly, in October 2021, losses were put at $2.9 billion yearly in tax waivers to multinationals.
shippingposition
Kindly like us on Facebook/twitter
