FIRS: Tax reforms will reduce taxes NOT introduce new ones

Zacch Adedeji, chairman of the Federal Inland Revenue Service (FIRS), has assured Nigerians that the ongoing tax reform will reduce taxes not introduce new ones or raise existing tax rates.

Adedeji gave the assurance during an interactive session with members of the senate committee on finance in Abuja on Tuesday.

Addressing concerns over the impact of the reforms, he clarified that the primary goal is to reduce the number of taxes paid by Nigerians and increase the efficiency of tax administration in Nigeria.

“The tax reform will not introduce any taxes or increase percentage of existing ones but reduce number of taxes being paid by Nigerians,” Adedeji said.

“The tax reform basically seeks to increase simplicity and efficiency of tax administration in Nigeria.”

He also noted that no agencies would be merged, and no jobs would be lost in the course of implementing the reforms, adding that the existing tax policies are not meant to tax poverty but to focus on prosperity.

“We are taxing fruits, not seeds—returns, not investments,” he said.

Providing an update on four executive bills currently before the national assembly, Adedeji said when passed into law, the bills will harmonise multiple tax laws, enhance efficiency and modernisation, simplify tax regulations, and foster synergy among revenue-generating agencies.

The bills include the Nigeria tax bill, the Nigeria Tax Administration Act (Amendment) bill, the Nigeria Revenue Service bill, and the Joint Revenue Board (Establishment) bill.

The reforms, according to Adedeji, will promote transparency, align with international standards, expand the tax base, and improve government savings.

President Bola Tinubu’s administration plans to introduce a series of reforms designed to boost government revenues and strengthen the economy.

The federal executive council (FEC) approved the economic stabilisation bills seeking amendment of tax policies on September 23.

On Monday, Taiwo Oyedele, chairman of the presidential committee on fiscal policy and tax reforms, said the personal income tax of Nigerians earning above N1.5 million will be increased gradually to 25 percent under the new economic stabilisation bill.

Also, on June 4, Oyedele said the committee proposed the reduction of the company income tax (CIT) by 5 percent over two years.

‘CURRENT NAME DOES NOT REFLECT SCOPE OF SERVICES’ 

Speaking on the proposed change of the agency’s name to the Nigeria Revenue Service (NRS), the FIRS boss said the current name does not fully reflect the scope of its services.

He also said 85 percent of the value-added tax (VAT) collected is remitted to state governments, while only 15 percent goes to the federal government.

In his remarks, Sani Musa, chairman of the senate committee on finance, reiterated the importance of tax reforms to the government’s agenda and called for contributions from all stakeholders.

“Tax reforms are central to the government’s agenda and require meaningful contributions from all stakeholders,” he said.

Musa commended the FIRS chairman for meeting the revenue targets for the fiscal year and urged him to go beyond the set targets.