18% tax-to-GDP ratio: We won’t increase taxes days FG
By Patience Ikpeme
The Federal Inland Revenue Service (FIRS) has assured corporate organizations that the goal to increase the country’s tax-to-GDP ratio from 10.86% to 18% won’t necessarily mean higher taxes or the introduction of new taxes.
The Service emphasized that the government, led by President Bola Tinubu, is focused on creating a favorable environment for businesses to succeed.
The Acting chairman of the Federal Inland Revenue Service (FIRS), Zacch Adedeji, gave the assurance when he met with representatives of large tax paying businesses in Lagos.
Under Adedeji’s leadership, the FIRS aims to achieve an eight percent increase in the tax-to-GDP ratio over the next three years, surpassing the African average of 16.5%, all while avoiding hindrances to investment or economic growth.
Adedeji told representatives of large tax-paying companies that the FIRS does not intend to introduce new taxes; instead, they plan to leverage data to enhance tax compliance.
He assured companies that are willing to fulfill their tax obligations that there’s no reason to be concerned. The strategy he said is to raise tax revenue by taxing prosperity, not poverty.
Adedeji made it clear that the 18% tax-to-GDP target won’t translate into higher tax rates. He mentioned the efforts of the Presidential Committee on Fiscal Policy and Tax Reforms to reduce the number of taxes as part of their mandate.
The purpose of engaging with these companies he said is to consider their input in forming a strategic plan to address challenges in tax revenue collection. Adedeji commended the companies for their responsible corporate citizenship and emphasized their crucial role in generating significant tax revenue for the government and maintaining economic and fiscal stability.
He acknowledged the challenges businesses face in Nigeria due to ongoing economic reforms and pledged to address concerns raised by the companies, including issues related to multiple taxes and tax oversight duplication.
Some of the notable companies at the event included Nestlé Nigeria Plc, ExxonMobil, Shell, Guinness, Nigerian Breweries Plc, Flour Mills, Dangote Group, MTN, and many others.
