Despite Raking in N168.9bn in 13 Years, NITDA Rallies IT Companies for Yearly Taxes

Emma Okonji

The National Information Technology Development Agency (NITDA), the federal government agency responsible for information technology (IT) development in Nigeria, in collaboration with the Federal Inland Revenue Service (FIRS), has appealed to IT companies to pay their one per cent annual levy.

This is to enable the agency carry out its statutory projects and initiatives for 2023.

The appeal is coming after NITDA raked in N168.9 billion from taxes in 13 years, according to the FIRS.

The Executive Chairman, FIRS, Muhammad Nami, who gave the figure during the 2023 NITDA/FIRS Stakeholders’ Engagement Forum, which held in Lagos yesterday, said: “FIRS is a key partner of NITDA. We assist in the assessment, collection and accounting for their revenue, as stated in Section 16 of the NITDA Act (2007).

“In 2022, FIRS collected and remitted the sum of N22,574,099,600.06 and the total sum collected by FIRS on behalf of the agency from 2008 to December 2022 is N168, 847, 118, 268.22.”

Nami, who was represented by the Group Lead, General Tax Operation Group at NITDA, Kabir Abba, said it was important to showcase the achievements of the agency, particularly as taxpayers could easily make a connection between the taxes paid and its socio-economic impact, which would also assist to improve voluntary compliance in payment of tax.    

Speaking on the achievements of NITDA, and the need for IT companies to pay their taxes promptly, the Director General of NITDA, Kashifu Inuwa Abdullahi, said since 2001, when NITDA was established, the agency had initiated, developed and implemented several IT policies that are driving development in the sector.

According to him, as government agency, NITDA only generates money through company income taxes, and he appealed to IT companies to collaborate with NITDA and pay their taxes regularly and promptly to enable NITDA successfully carry out its projects that are geared towards IT development in a digital era.

“NITDA will continue to drive innovation in the IT sector that has out-performed the once lucrative oil and gas sector from 2019 to 2022. In 2019, ICT contributed 13 per cent, while oil and gas contributed eight per cent to Nigeria’s Gross Domestic Product (GDP). In 2020, ICT contributed 18 per cent to GDP, while oil and gas contributed 8.2 per cent to GDP.

“In 2021, ICT contribution to GDP declined to 14.11 per cent because of the effect of COVID-19, while oil and gas contribution to GDP also declined to 7.3 per cent.

“In 2022, ICT contributed 16.6 per cent to GDP, while oil and gas contributed 6.4 per cent to GDP,” Abdullahi said.

Listing the challenges in the IT sector, Abdullahi said the sector was faced with limited infrastructure, limited access to market and challenges in early stage funding.

He, however, said despite the challenges, NITDA would continue to drive innovation in the sector, connect the unconnected, adding that NITDA needs money through taxes, to achieve its projects and to provide infrastructure and develop more IT skills among Nigerian youths.        

“Nigeria has the advantage of developing into a digital economy, based on our population of over 200 million people, with youths forming 50 per cent of the population. Nigeria has the highest inflow of Foreign Direct Investment (FDI) coming into Africa through technology, and Nigeria has five among the seven unicorns in Africa. “In 2019, Nigeria raised $704 million, which amounted to about 92 per cent of the total FDI inflow into West Africa region. In 2020, Nigeria raised $440 million, which amounted to about 83 per cent of the total FDI inflow into West Africa region. In 2021, Nigeria raised $1.7 billion FDI.

“In 2022, Nigeria raised $1.3 billion FDI in the IT sector, and NITDA is driving these developments.

“NITDA has embarked on building a secretariat for the implementation of the Startup Act and all these again, are capital intensive and we are using money generated from taxes to finance the projects,” Abdullahi said.

Stakeholders present at the forum, promised to collaborate with NITDA to achieve more.     

General Manager, Corporate Affairs at MTN, Omasan Ogisi, said: “As an organisation, MTN believes in the digital economy and will continue to support NITDA in achieving its digital economy plan for Nigeria.”