FIRS Chairman calls on states to gear up for tax reforms
Dr. Zacch Adedeji, Chairman of the Federal Inland Revenue Service (FIRS), has called on state governments to prepare for impending tax reforms aimed at enhancing Internal Generated Revenue (IGR). Speaking at the 155th Meeting of the Joint Tax Board (JTB) in Suleja, Niger State, Adedeji emphasized the need for robust IGR systems to drive socioeconomic and human development.
Adedeji highlighted the significance of efficient revenue administration at the subnational level, noting the necessity of optimizing IGR collection. He pointed out that current tax reform efforts, spearheaded by the Presidential Fiscal Policy and Tax Reforms Committee, will have significant implications for revenue authorities at all government levels. He expressed optimism that innovative approaches could help Niger State achieve a monthly IGR target of N5 billion.
Governor Mohammed Umar Bago of Niger State, represented by Mustapha Ndajiwo, Commissioner for Budget and National Planning, presented a case study illustrating the successful improvement of IGR in Niger State. Ndajiwo reported an average monthly IGR collection of N2,621,710,688.94 between January and May 2024, compared to N1,806,280,088.25 during the same period the previous year. In May 2024 alone, the state collected N3,508,389,805.20, marking a 45 percent increase.
Ndajiwo attributed this growth to several key strategies:
1. Strategic Reforms and Innovative Approaches: Niger State implemented reforms and introduced innovative methods to enhance tax collection processes.
2. Transparency and Efficiency: The state prioritized transparency and efficiency in its tax administration to build trust and improve compliance among taxpayers.
3. Taxpayer Education: Educating taxpayers about their obligations and the benefits of paying taxes has been a cornerstone of Niger State’s strategy.
4. Collaboration with the Joint Tax Board: Active collaboration with the Joint Tax Board allowed for the exchange of ideas, best practices, and solutions to shared challenges in tax administration and revenue optimization.
Adedeji’s remarks and the success story from Niger State underscore the critical importance of preparing for and adapting to the upcoming tax reforms. As these reforms are implemented, state governments must focus on strengthening their revenue collection mechanisms to ensure sustainable development and improved public services.
The upcoming tax reforms are expected to bring about significant changes in the way taxes are administered and collected in Nigeria. State governments are encouraged to take proactive steps to align their IGR systems with the new reforms, leveraging technology and best practices to enhance efficiency and effectiveness.
Dr. Adedeji’s call to action serves as a timely reminder of the need for continuous improvement in tax administration at all levels of government. By embracing these reforms and implementing innovative strategies, state governments can optimize their revenue collection efforts, thereby contributing to the overall development of the country.
In conclusion, the FIRS Chairman’s appeal for states to brace up for the impending tax reforms highlights the importance of robust IGR systems in driving socioeconomic growth. The success story from Niger State serves as a model for other states to follow, demonstrating that with the right strategies and commitment, significant improvements in revenue collection are achievable. As the nation prepares for these reforms, it is imperative for all stakeholders to work collaboratively towards building a more efficient and effective tax administration system.
