N17 trillion tax waivers loss imperils nation – Senate

The economic hardship rocking seems to be putting the Parliamentary arm of government on it toes as the Senate through its Committee on Finance on Monday, frowned at N17 trillion loss incurred by the country on tax waivers within the last five years.

President Muhammadu Buhari’s administration had given tax holidays and incentives to some companies that has brought about a huge loss to the tune of N17 trillion, hence, the Federal Inland Revenue Service, FIRS, was asked to suspend the tax waivers being largely abused and substitute it with rebating system.

Senate’s objection to the allegedly abused tax waivers came to the fore during 2024 budget presentation of FIRS to its committee on Finance .

This is even as the Chairman of FIRS, Zacch Adedeji who made projection of N19 .4 trillion as targeted total tax collection for 2024, insisted that the fresh N2.7 trillion Tax Credit planned for road construction in the country by the Nigerian National Petroleum Company Limited, NNPCL, should be stopped .

In his remarks at the budget presentation session, the Chairman of the Committee, Senator Sani Musa told the FIRS Chairman that tax waivers abuse which has cost the country about N17 trillion loss within the last five years should be suspended and substituted with rebating system.

“Your projection of N19 trillion as total tax collection for 2024 is good when compared to N11.16trillion achieved in 2023 but the senate believes that you can can do more even to the tune of N30 trillion if required measures are put in place.

“As impressive and encouraging the performance and projections of FIRS are under your leadership, this Committee and by extension, the Senate on a serious note, urge you to look at the direction of tax waivers largely being abused with attendant and avoidable losses being incurred on yearly basis .

“Available records , show that within the last five years , about N17 trillion have been lost by the country to tax waivers .

“It should be suspended and possibly substituted with rebating system “, he said .

The FIRS Chairman in his presentation , informed the committee that’to save Nigerians from multiple taxation, FIRS in collaboration with committee set up by the President Bola Tinubu, would reduce the 62 different taxes to 8.

“President Bola Tinubu has seen the issue of multiple taxation as a pool of problems that is why he set up the presidential committee on tax reforms and fiscal policy.

As of today in Nigeria, we have 62 types of taxes being collected.

The sad news about that is that less than eight out of the entire 62, accounted for 97 per cent of the collection.

“We are already consulting and engaging the state government on it. At the end of the day, we won’t have more than eight or nine taxes that the state and federal government would be collecting”, he said .

On controversy trailing the implementation of Tax Credit Scheme for road construction by NNPCL, the FIRS boss insisted that the N2.5trillion earlier committed to it , must be fully implemented before thinking of any fresh one.

He said : “Regarding tax credit, what I said was that the programme is laudable but that the N2.5 trillion being spent on it by NNPCL should be exhausted before bringing fresh request.

“N2.7 trillion fresh request being made, should not be entertained because all NNPC revenue should not be spent on roads when the Ministry of Works is there “.