SOLA OGUNDIPE writes that the new national tax policy and Taxpayer’s Identification Number ,TIN, is  gradually gathering momentum, even as the Federal Government

HAVE you obtained your   Taxpayer’s Identification Number, TIN? If not, now is a good time to get one because henceforth, you would be required to show it.

The TIN is now a prerequisite to the transaction of certain social services such as enrolling your  child in school, carrying out bank transactions, obtaining government loans, registration of businesses, motor vehicles, certificates of occupancy and many other public transactions.

In 2013, when President Goodluck Jonathan launched the new National tax policy and the TIN initiative, there was a lot of skepticism.

Doubts were expressed in several circles  about the ultimate success and effectiveness of the initiative towards ensuring that all Nigerian citizens of working age pay tax.

Nevertheless, the newly introduced taxation process has come to stay.

Partnership: From hindsight, tax payment is not a favourite pastime of many Nigerians. For most, tax payment is regarded more of an option than the rule. But the President noted emphatically that in the new dispensation, the issue of taxation would be a partnership. He said Nigerians should consider themselves custodians of the tax system in partnership with the government.

In this respect, the newly introduced taxation process is designed to bring on board a host of innovations to erase inadequacies of the past and build confidence for the future. It sets parameters for taxation and auxiliary matters while providing clear principles governing tax administration and revenue collection. In a nutshell, the whole essence of the TIN is to create  a self-sufficient economy that would lead to increased revenue from taxation in line with global best practices.

The Taxpayer’s  Identification Number, TIN, is an electronic register of all taxable entities in Nigeria. It is a nationwide electronic database system for the registration and storage of data of taxpayers in the country. The main purpose is to uniquely identify tax payers. In the previous system, a company with multiple locations would require multiple numbers. In the new system,  the entire process is centralised.

Awareness

Project Manager of the TIN, Mr. Oduba Oduba, explains that the system of old is set to change for good with the coming of the new tax system. “A tax payer is a person who should pay tax. The TIN  is the way to go.

We are working on creating more awareness for the TIN system in 2014, using the approach of taking the initiative directly to the tax payers. The plan we are working on involves attaching social services to the TIN system, e.g. Driver’s License, International Passport, and other ancillary services would all soon require TIN registration.”

Outlook for 2014: Oduba, who says the overall  level of acceptance of the programme is still low for individuals but much better for organisations, described the Agency’s outlook for 2014 concerning the TIN programme is not overly ambitious.

“Corporate bodies captured in the database are at least 500,000, which cover most of the active businesses in Nigeria. The Customs Service have made it mandatory for businesses to process all transactions at the Ports with a TIN which has motivated active participation by companies in the new tax identification system.

Integration and compliance: Already, organisations such as the Nigerian Customs Service have fully integrated the TIN administrative system into their operation. Moves are on by the Agency to ensure compliance by other agencies to integrate the TIN into their operations.

“If you take a good look at the new Driver’s License, you will observe it has a space for the TIN. We are also collaborating with the National Identity Management Centre, NIMC.

Active participation

Primarily, the TIN system has encountered resistance from individuals unwilling to register. The scheme has not witnessed active participation from individuals.

“For the ordinary trader who feels he has no business with government to warrant him paying tax and thereby having a TIN, we’re going to make the TIN a prerequisite for the use of social services. For example, as a parent, you may soon be required to present your TIN so as to take advantage of free education for your children,” Oduba cautioned.

Security and efficiency: But as commendable as the TIN initiative is, does it possess adequate infrastructure  to ensure smooth operation? In this respect, Oduba is optimistic.  “We have infrastructure in all the states of the Federation. We have also trained personnel in all the states. However, unless a state contributes a counterpart fund, it cannot take part in the project.

Worse still, concerns have been raised about the protection of data as well as the privacy of individuals and corporations.

Access

By implication, through the TIN, government will have access to a large database of private and sometimes very sensitive personal information. But even though there are different categories of users who can access the system, not every user will have access to all the information in the system.

The level of authority will determine the information a personnel will have access to. “We need to acknowledge that no system is completely foolproof. But the TIN system has no incentive to motivate fraudulent behaviour. There is no monetary benefit attached, hence there may be no benefit to steal and use another person’s TIN for personal gains.
Benefits: Although the TIN system has been around for some time, in concrete terms, the electronic identification of tax payers has streamlined tax administration. While the previous system was cumbersome, for example, a company needed different tax numbers whenever it relocated, there are  at least  29 states of the Federation already participating in the project and counting.

Joint Tax Board: “In consideration of the Joint Tax Board, JTB, as a policy board for creating uniformity in tax administration, the TIN will help  eliminate double taxation.

Nationwide database system

States will be able to share information within the nation-wide database system. In states such as Lagos and Ogun where there is confusion concerning where residents should pay their tax,  under the TIN system, taxpayers will be identified by their Local Government Council.

Obtaining your TIN: The process of obtaining the is quite straightforward. Simply visit any of tax offices located in the country and obtain the relevant application forms. Fill and submit the  completed form with a valid proof of identity in the form of your drivers license, international passport, national identity card, utility bills or any similar documents.

Complete  the biometric verification at the point of submission. Corporate  organisations can simply write to the tax comptroller, and submit the letter with photocopies of the company’s certificate. Upon verification of the details, the TIN will be issued, free of charge.

Benefits: The benefits of getting the TIN are many. As a taxpayer, there is ease of access to information about your tax status anywhere around the world, avoiding incidence of double or multiple taxation. Because the TIN is unique to each taxpayer,  it may be quoted for all tax purposes nationwide.