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New FIRS Chairman targets 18% tax-to-GDP ratio

New FIRS Chairman targets 18% tax-to-GDP ratio %Post Title

The new acting Chairman of the Federal Inland Revenue Service (FIRS) Zacch Adedeji has stated his commitment to surpass Africa’s tax-to-GDP ratio of 16% and extend Nigeria’s ratio to 18%.

Mr. Adedeji stated this when he officially resumed office as the country’s chief revenue collector.

In his words,

  • “Our aspiration is audacious – to surpass Africa’s average tax-to-GDP ratio of 16.5% and achieve an impressive 18% within three years. By doing so, we aim to reduce our nation’s reliance on borrowing and ensure financial sustainability,”

Commitment to technology

He noted that the FIRS will commit to innovation, technology, and novel ideas in its activities.

He said,

  • “As we chart our course ahead, FIRS is committed to placing innovation, technology, and fresh ideas at the forefront of our operations,”
  • “This strategic focus will empower us to enhance efficiency, fortify against revenue leaks, and bolster coordination and accountability within our organization.”
  • “Our overarching goal is to nurture voluntary tax compliance by establishing a modern, dependable tax system that garners the trust and admiration of all stakeholders. Through this, we hope to create an environment where taxpayers willingly fulfil their civic duties.”

On tax defaulters

On tax defaulters, Mr Adedeji said the service will act responsibly by enforcing a comprehensive enforcement system that prevents citizens from defaulting while ensuring fairness and transparency.

He stated,

  • “For those who deviate from their tax obligations, be rest assured, we will enforce our responsibilities judiciously,”
  • “The principles of integrity, confidentiality, professionalism, and fairness are non-negotiable in our service to the nation. Upholding these values will guide our actions and interactions as we work tirelessly to fulfill our mission.”
  • “I pledge to maintain an open-door policy, actively engaging with stakeholders to collaboratively construct a tax administration that we can all take pride in. Together, we will build an institution that serves as a beacon of excellence,”

What you should know

Nigeria’s current tax-to-GDP ratio stands at 10.8% in 2022- one of the lowest in the world. President Bola Tinubu has promised to increase this figure to 18% in the next three years.

  • Although Nigeria’s revenue generation increased by 56% to N10 trillion in 2022, the current administration believes there is more work to be done.
  • In a bid to sanitize the fiscal policy space, President Tinubu inaugurated the President Fiscal Policy and Tax Committee headed by former Fiscal Policy and Tax leader at PwC Mr. Taiwo Oyedele.

In the first six months of this year, the FIRS beat its target by collecting N5.5 trillion in taxes and is on course to beat its record of 2022. (Nairametrics)

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