“Such requests and applications for parliamentary approval shall stipulate clear conditions and justification for granting tax waivers and investment incentives,” it said.
Senator Abdullahi, in his lead debate, said the bill became imperative due to leakages and loopholes in tax collection and remittances to the government amid revenue shortfalls and a high public debt profile.
He expressed worry that in the last five years, the country was unable to achieve its revenue targets.
Figures from the Debt Management Office (DMO) showed that N3.9 trillion was realised out of the targeted revenue of N7.2 trillion in 2018.
In 2019, the target was N7 trillion while the actual revenue collected was N4.12 trillion. The sum of N5.4 trillion in revenue was targeted in 2020 but N3.9 trillion was received.
In 2021, the target was N6.4 trillion while N4.64 trillion was received. In 2022, the targeted revenue was put at N5.82 trillion while the actual revenue received was N3.66 trillion.
The lawmaker expressed concern that debt service is consuming over 90 per cent of the government’s revenues up from 32.7 per cent in 2015.
He said, “If this trend of relentless reliance on increasing public debt to finance the budget continues without a corresponding rise in revenues, the country shall slide into distress and insolvency.
“With petroleum revenues dwindling into insignificance, we must rise to rationalize the system of tax administration by blocking loopholes, and tax evasion and ensuring utmost efficiency in tax management.
“It is important to note that even while government explores other means of increasing its revenue streams and improving collecting capacity, the National Assembly must act with firmness and determination to ensure that we initiate and pass laws that regulate revenue streams collection and remittance.
“In early 2020, the FIRS reported a loss of N 1.3 trillion to tax waivers, in five years. And this was in just three sectors of the economy. Similarly, in October 2021, losses were put at $2.9 billion yearly, in tax waivers to multinationals.
“It is obvious that there are several other similar cases, and all this happening in the face of the government’s increasing difficulties to fund its various development projects and welfare commitments across the country.
“The overall intendment of this Amendment Bill, therefore, is to ensure that government can pool all its collectibles in one coffer, to be able to target its allocations to those areas of priority in the country.
“An effective way to do this is to re-organize the processes of granting tax holidays, investment incentives and waivers to private individuals and corporate entities for effective coordination and transparency.
“We must also ensure that such applications are placed before the National Assembly, to ensure that all arms of the government are on the same page on this delicate matter.”
The bill, after scaling the second reading was referred to the Senate Committee on Trade and Investment for further legislative work.
