By Christiana Ekpa
The Chairman of the Federal Inland Revenue Service (FIRS), Muhammad Nami yesterday revealed that his agency targeted a total revenue of N5.900 trillion in 2021, just as the Comptroller General of the Nigeria Customs Services, (NCS) Col Hamid Ibrahim Ali disclosed that, the Customs Service was targeting N1.465 as revenue from both federation and non-federation source.
The two revenue generating agencies of the Federal Government disclosed these when they appeared separately before the House of Representatives Committees on Finance and House Committee on Customs and Excise to present their 2021 budget estimates.
The FIRS Boss projected that, collections of non-oil and oil revenue is expected to contribute N4.26 trillion and N1.64 trillion respectively, while the cost of collection (7% net of 2% NCS VAT) is projected at N289.25 billion.
He said the primary objective of the 2021 budget was to reposition the Service towards achieving optimal assessment and collection of tax revenue for the Government, and predicated on a marginal reduction in the taxable income of tax payers due to the effect of COVID-19 pandemic.
Nami gave other indices on which the budget was predicated to include the exemption of some categories of tax payers from payment of tax as enshrined in the 2019 and 2020 Finance Act which is expected to impact on revenue collection, increase in oil production during the year, adding that adoption of the Medium Term Expenditure Framework (MTEF) of the Federal Government among others.
He said as part of strategies to achieve the revenue target, the FIRS will continuously improve its technology for automated tax collection across all sectors of the economy through e-filing, e-registration, e-payment etc to facilitate ease of doing business with tax payers, introduction of measures to increase Tax Audit and Enforcement activities nationwide.
According to him, the service will also intensify tax payers education and engagement with a view to improving compliance with tax laws, get closer to tax payers by opening of new offices in selected business districts across the country, expand the already existing synergy with States Internal Revenue Services, provision of adequate working tools and conducive working environment for staff, increase the capacity of staff through structured training and payment of staff entitlements as at when due including performance incentives and reward for hard work.
Reviewing the performance of the 2020 budget of the service, Nami said out of the projected revenue of N5.076 trillion for 2020, the FIRS collected about N4.950 trillion representing about 98%.
According to him, of the total collection, non-oil and oil collections contributed N3.435 trillion and N1.515 trillion respectively, while the cost of collection (4% net of 2% NCS VAT) of N130.45 billion was achieved against the budget of N180.76 billion to fund the three operational expenditure heads for the year.
However, it was observed that the figures quoted by the FIRS as the VAT collected on its behalf by the Nigeria Customs Service of N13.345 billion was different from the one quoted by the Customs which stood at N350.63 billion
On his part, the Comptroller General of Customs, Col. Hamid Ibrahim Ali said the revenue target of N1.465 trillion for 2021 was based on the Medium Term Expenditure Framework approved by the National Assembly.
Ali said the Customs Service was able to generate about N1.562 trillion in 2020, adding that this feat was achieved in the face of daunting challenges which included standing government deliberate trade and economic policies such as restriction of 43 items from accessing forex at official window.
Other challenges he said include non-functional scanners at the various customs scanning sites which has contributed to the inability to carry out effective examination of selected consignment, collection of excise on only two commodities, porous nature of the border which leads to smuggling activities and the extant laws governing the operation of the service which is overdue for amendment.
Ali said further that the service has put a number of measures in place to ensure increase revenue generation of the Service in the coming years, including the e-Customs project which has been approved by the Federal Executive Council.
He said the e-custom project also include the purchased of operational scanners for the nation’s ports, border surveillance equipment among others, stressing that the expectation of the service is that the reform would increase the revenue base of the service.
Other measure being put in place to increase revenue base include review of tariff on vehicles which is aimed at reducing smuggling of vehicle into the country, reintroduction of import taxes on petroleum products, expansion of excisable items, reopening of the border, CBN intervention in the purchase of functional scanners, more stakeholder collaboration, anti-smuggling drive among others.
According to Ali, stakeholder collaboration should be geared towards compliance with the issue of full declaration, adding that “if 75 percent of our stakeholders comply with the policy of full declaration, we will have so much revenue”.
The Customs Boss said that currently, the service has about 15,439 personnel and plan to recruit 3,200 which is the number approved for it by the President since 2018 adding that out of the number to be recruited, only 800 will be graduates while the rest will be diploma holders.