Akwa Ibom state has moved from 16th position on the Internally Generated Revenue (IGR) rating table in 2015 to number six (6) on the table in 2019, going by the latest rating released by the Joint Tax Board (JTB).
The state’s IGR reached an all-time high of N24.8billion within eight months, January to August 2019. This amount represents 57.05 per cent of the projected IGR (N43.6billion) for the 2019 business year.
The governor, Mr. Udom Emmanuel gave the figure in the performance review of the 2019 budget while presenting highlights of the 2020 budget to the Akwa Ibom state house of assembly.
“As at August 2019, the actual recurrent revenue collected was N190.66 billion… a breakdown of this shows that Internally Generated Revenue (IGR) was N24.875 billion.”
The IGR for 2019 is more than the sum of the state’s IGR realised in 2016 and 2017 and N5.7 billion higher than the N19.04 billion generated between January and September 2018.
The state generated N11.3billion between January and September 2016 and N10.4billion within the same period in 2017.
The state’s IGR started picking up in 2015 when Mr Udom Emmanuel took over as governor.
The Akwa Ibom State Internal Revenue Service (AKIRS) under the Emmanuel administration’s, led by Mr Okon Okon, has aggressively pursued tax recovery from organisations that evaded taxes in the last 10 ten years.
The recovery must have accounted for the improvement in the state’s IGR.
There have been major reforms in tax administration in the state since the Udom Emmanuel administration came on board in 2015.
Some of the reforms include the signing of the Akwa Ibom state revenue administration bill 2016 which grants autonomy to the AKIRS, automation of tax collection process, and approval of 2.5 per cent incentive to all revenue-generating agencies of the state.
Mr Leo Umana, Executive Director Tax Recovery and Enforcement said strategic reforms introduced by the AKIRS have improved tax administration in the state and this account for the significant improvement in the IGR.
“The successes we have been so far being because all of us have worked together as a family. And, of course, we must give credit to Governor Udom Emmanuel for signing the Akwa Ibom State Internal Revenue Service Administration Law that grants autonomy to the board. That has been the beginning of the turning point.”
Akwa Ibom state was trudging towards the lower rung on the tax table before 2015 due to leakages, corruption and lack of commitment by the state government’s revenue officers.
It was learnt that under the previous administration, many organisations in the state including government-owned investments were not remitting relevant taxes especially PAYE to the government and there was no commitment on the part of the government to explore new tax options, enforce or recover taxes withheld by organisations.
“When we came on board we discovered that there were a lot of leakages especially in the road taxes, so we introduced automation and that has really helped”, Umana noted.
Our correspondent learnt that the automation of the tax collection process has blocked leakages in road taxes accruing to the state.
When the current board came in it used to generate between N6 – N8million monthly from the road taxes, but that rose to N18millon in the month it introduced automation.
Now the board generates between N28 – N32million monthly.
Akwa Ibom State is currently ranked the sixth on the IGR performance rating in 2019 according to data obtained from the Joint Tax Board and National Bureau of Statistics.
Lagos, Rivers, Ogun, Delta and Kaduna are the first top-five on the table.
Akwa Ibom used to stand behind Kano, Cross River, Edo, Bayelsa, Ondo and Osun states on the IGR performance rating.
There has been noticeable coordination in tax collection, transparency and ease in payment of tax, and an unprecedented level of tax enforcement under the new Akwa Ibom State Internal Revenue Service (AKIRS) board led by Mr Okon Okon.
About 80,000 people have been brought under the state’s tax net within the last two years.
“When we were sworn-in, the people we met on ground in the tax net were not up to 15,000. But now the number of people on the tax net is above 100,000”, Umana said.
AKIRS has been on aggressive tax enforcement in the state in the last few months.
Umana said the AKIRS under the chairmanship of Mr Okon Okon has pursued vigorously the recovery of taxes from defaulting organisations.
“The law allows us to investigate organisations for about ten years in past. So we did that and made a lot of recovery from financial institutions that are operating in the state.”
The steady growth of the state’s IGR under the current AKIRS board is giving the state government more confidence to target a higher IGR in 2020.
The state is projecting N52.556 billion IGR in 2020. This is about N556 million higher than the projected statutory allocation for the year 2020