By Michael Eboh
Following the agitations by individuals, companies and thenorganised private sector (OPS) over multiple taxation, the federal government has announcedÂ plans to introduce measures that will help address the issue and thus boost its revenue profile in the years ahead.
Individuals and businesses have consistently called on the government to help address the issue of multiple taxation that has acted as aÂ bane of investment in the country.
Aggrieved individuals and companies have called for a reduction in some of the taxes, especially the 10 per cent withholding tax charged on dividends and other taxes in capital market transactions.
According to a statement by the Minister of Finance, Dr. Mansur Muhtar, presented at the third African Tax Administration Forum in Abuja on Tuesday, the federal government noted that the incidence ofÂ multiple taxation and an uncoordinated tax administration system in the country, have brought about an increase in the tax evasion and avoidance, thereby impacting negatively on governmentâ€™s drive to shore up its revenue.
Muhtar, who was represented by Permanent Secretary, Ministry of Finance, Alhaji Atiku Kido, noted that the measures aimed at bringing reforms to the countryâ€™s tax systems will include: improvement in non oil revenue collection and strengthening of oil collection procedures, prompt remittance and safe keeping of all revenues with the Central Bank of Nigeria (CBN), as well as the commencement of taxpayersâ€™ enumeration exercise for the purpose of developing an unfailing tax data base.
He said, â€œThe high level of tax evasion and avoidance occasioned by ignorance and the perception that government is not accountable; weak and incapacitated tax administration machinery, coupled with inappropriate personnel skill mix and unwieldy operational procedures are a big problem for the tax system in Nigeria .â€
â€œOther challenges, include manual tax administration and an unwieldy operational procedure, lack of tax refund machinery in place, multiple taxation being imposed by states and local councils, and lack of a reliable tax database and knowledge of taxpayersâ€™ businesses.
â€œWe have identified a number of reforms that will address these issues, among which are: Re-engineering of the human resources function in the FIRS, adoption of the integrated tax administration system, establishing an effective tax policy function with the ministry of finance as well as effective collaboration between ministries, departments and agencies.
In this regard, there is the urgent need to increase the level of voluntary compliance and combat the menace of tax evasion. The need to improve information collection through the use of information agreements for analyzing and managing information such as the modernisation of tax administration must be emphasised.â€