Tax Experts: FIRS Needs Aggressive Public Enlightenment to Win More Taxpayers

Dike Onwuamaeze

Tax experts have advised the federal government and the Federal Inland Revenue Service (FIRS) to embark on persistent, sustained and result oriented driven public education that would encourage more Nigerians to become taxpayers.

The experts also stated that the objective of this enlightenment campaign should be to encourage Nigerians to see themselves as partners in national development and progress with the government by highlighting what government does with revenue it garnered through tax collection to present and prospective taxpayers in the country in order to bring more Nigerians into the tax net.   

They proffered this advice in Lagos during a one-day capacity building training for business editors and finance correspondents and stakeholders in Nigeria’s taxation system with the theme, “Tax and Media: Communicating the Importance and the Impact.”

The workshop was organised by the Omnimedia Nigeria Limited in conjunction with the FIRS.

The Special Adviser to President Muhammadu Buhari on Media and Publicity, Mr. Femi Adesina, who was among the special guests during the workshop, revealed that it was the FIRS and the Nigeria Custom Service that provided the revenues that enabled the federal government wade through the gloomy period of global lockdown during the spread of COVID-19 in 2020.

Adesina said: “But surprisingly, the FIRS met its target, and that target has been exceeded in subsequent years,” adding that the Chairman of the FIRS has done very well in “providing the President Buhari’s administration with support that is very, very good.” 

A Marketing Communication Specialist and Executive Producer/Editor in Chief of Energy and Business Media, Mr. Ademola Adedoyin, said in his presentation titled, “Media as Bridge between FIRS and the Tax Paying Public,” that “tax manager should demystify tax matters and continue to educate the taxpayers.”

Adedoyin referred to research done by the World Bank Group and PwC that titled ” Paying Taxes 2015: The Global Picture,” which ranked Nigeria as the 3rd worst globally in the time it takes taxpayers to comply. According to the report, it takes the taxpayer in Nigeria an average of 908 hours to comply, compared to 224 hours in Ghana, 202 hours in Kenya and 200 hours in South Africa.

He, therefore, averred that the media can help FIRS to connect with the tax paying public.

Adedoyin said: “The FIRS will have to take more proactive steps to mobilise and deploy the media in the critical task of educating and enlightening the public on tax issues, if it must succeed in the discharge of its statutorily assigned mandate.

“Given the awful statistics of compliance level to tax responsibility by Nigerians, FIRS will have to work out a mutually beneficial partnership arrangement with the media to widen its tax net and deepen its revenue generation through tax.

“It will have to embark on a consistent, sustained and result driven education and enlightenment initiative that will encourage more Nigerians to become taxpayers.

“Since the Media is the bridge between FIRS and the tax paying public, the agency will need to regularly embark on capacity building to sharpen the skills of Business Editors/Financial Correspondents whose duty it is to report and educate the public on its (FIRS) activities.

“Most importantly, FIRS will have to bring millions of productive Nigerians who are currently not tax paying into the tax net, even as it should aggressively ensure that those already captured in the tax net unfailingly discharge their duties to the state, through a strategy that will make the taxpayer and the tax collector to see themselves as partners in progress.”

Similarly, in his presentation titled, “Understanding Taxation with Focus on the FIRS Mandate, Vision and Policy Thrust of the Present Chairman, Mr. Mohammed Nami, executive chairman of FIRS,” the Managing Partner of GBC Reanda (Chartered Accountants and Tax Practitioners), Mr. Gbenga Badejo, stated that in modern economies, taxes are the most important source of governmental revenue but not its only source of revenue.”  

Badejo described tax as, “a compulsory financial charge or some other type of levy imposed on a taxpayer (an individual or legal entity) by a governmental organisation in order to fund government spending and various public expenditures (regional, local, or national), which transfers wealth from households or businesses to the government and has effects on economic growth and economic welfare that can be both increased (known as fiscal multiplier) or decreased (known as excess burden of taxation).”

Speaking in the same vein, a lecturer in the Department of Commercial and Industrial Law, Faculty of Law, University of Lagos, Dr. Philip A. Folarin, who delivered a paper on, “Understanding the Law of Taxation for Effective Tax Management: Citizens’ Obiligationa and Rights,”  emphasised that tax and taxation do not mean the same thing and should not be used interchangeably.

“Taxation,” Folarin explained, “is the entire process or system by which government generates revenue through the imposition of tax. This system usually involves tax policy, tax law and tax administration.”

According to him, “a good and effective tax system stands on a tripod of tax policy, tax laws and tax administration.”

He pointed out that a good taxation must rest on ability of the taxpayer to pay, administrative efficiency whereby the cost of administering the tax by the tax authority should not exceed total revenue generated from the tax as well as certainty to avoid arbitrariness.