Wednesday, February 21, 2018 11.00AM / Proshare WebTV
The Chairman of the Federal Inland Revenue Service Board Mr Babatunde Fowler says Nigeria has so far collected N20bl out of the target N305bl from the Voluntary Asset Income Declaration Scheme.
He disclosed this in an interview with financial correspondents at the February 2018 members evening of the Institute of Directors in Nigeria in Lagos, where he was the guest speaker on the “VAIDS”.
The “Voluntary Asset Income Declaration Scheme”, is a 9 month Federal Government window (July,2017 to March 31,2018) given to taxpayers to regularize their tax status relating to previous tax periods and pay any taxes due. The tax period in review is between 2011-2016 and in exchange for fully and honestly declaring previously undisclosed assets and income, tax payers will benefit from forgiveness of overdue interest and penalties, and the assurance they do not face criminal prosecution for tax offences or tax investigations.
Mr Fowler believed the VAIDS, presented an opportunity for Nigeria to improve and widen its tax net and also make progress in its Tax to GDP ratio, which is currently at a very low rate of 6%.
Speaking further he shared that a major takeaway from the UN,OECD forum he attended in New York, USA was the fact that the sustainable Tax to GDP ratio for any economy, was 15%. He however noted that so far through the VAIDS and other tax strategies in place, the soon to be released Tax to GDP ratio for Nigeria, shows remarkable improvement.
In terms of revenue, the FIRS boss reported that Nigeria recorded significant progress in 2017 with a N4trl revenue, an increase from N3.3trl in 2016. For 2018 which is yet to be approved by the National Assembly, Fowler shared that the target revenue was N6.3trl.
He said the VAIDS was designed to address the anomaly of 14ml out of 70ml economically active Nigerians, being tax compliant in the country.
On the issues of tax evasion, he warned that with critical multilateral agreements signed on the “Automatic Exchange of Information for Tax purposes”, Nigerians and Corporates only have the option of complying with the tax provisions.
He tasked the IOD members to play the critical role of “Tax Ambassadors” ensuring compliance from their corporations, and supporting the awareness and sensitization on “VAIDS”.
The President of the IOD Nigeria Alhaji Ahmed Rufai Mohammed in his opening address said that the “VAIDS” was a timely scheme introduced by the Federal Government, which will address the tax compliance issues in Nigeria.
He however raised concerns over the slow pace of response to the campaign and in the light of it, and asked for an extension of the time beyond the March 31, 2018 deadline.
Giving the Practitioner’s perspective Mr Wole Obayomi, Head, Tax and Regulatory, KPMG Nigeria believed the “VAIDS” was an opportunity by the government to lessen the burden for taxpayers who are behind in their compliance.
Mr Obayomi said the “VAIDS” covered personal income tax, petroleum property tax, value added tax, education tax, withholding tax, capital gains tax and stamp duties.
Obayomi also intimated the IOD Nigeria members that they has been a robust coordination amongst nations, with multi-lateral agreements covering 97 countries on tax compliance.
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