FIRS Targets N10.104trn Revenue In 2022,Brings Twitter, Facebook  Into Tax Net 

The Federal Inland Revenue Service,says it  is projecting to generate the sum of N10.104trillion  in the 2022 fiscal year.

Chairman of the agency,Alhaji Mohammed Nami,  told members of the House Committee on Finance at an interactive session on the 2022-2024 Medium Term Expenditure Framework and Fiscal Strategy Paper that the FIRS would meet the target inspite of the impact expected from the coming into effect of the  Petroleum Industry Act.

He spoke in response to a question from the chairman of the committee, James Faleke on Finance on how much the FIRS will be giving to the federal government next year.

He added that: “The total collection that we try to generate and remit to the Federations Account in 2022 is N10.104trn. However, for Federal government, we are going to remit personal income tax of N113 billion, education tax of N305 billion and NITDA of N21 billion.The total amount for the federal government will however be N2.053 trillion while the balance will be shared among states and local government. When you remove Education tax, Personal Income Tax and NITDA, what you have left is about N9 trillion and we take 15 percent of that and added VAT to it, it will give you N2.053 trillion.

A summary of the amount revealed, that is about N7.010 trillion will go to the Federations account, N2.441 trillion going into the VAT account while N113.298 will go into the consolidated account of the government”

He said the projections were prepared using the template of 56 dollars per barrel of crude with an exchange rate of N410 to the dollar.

According to him, the FIRS is taking advantage of the digital economy in the country to increase revenue generation, adding that Twitter and other social media platforms were already registering with the service for the purpose of tax payment.

He said:”We expect that with the new Petroleum Industry Act, there are some reconciliations that will be carried out that might affect the projections for 2022. We expect that there are new expenditure that will be roll over to the new regime. So, what we are trying to do is to ensure that we adjust those expenses for the year 2022.

“We know that if we do that,” he stressed further, “it is going to affect our ability to collect more revenue in that area. There are currently some allowances they have been able to use, but they will use it because this will be a new regime. It is not going to be the one that has investment tax allowance any more. It is going to be based on actual performance.

“But we are going to recognize whatever they have now as a cost before you arrive at the actual profit they are going to generate. So, what we have planned to do is to aggressively conduct audit and investigations in the year 2022. So, we are projecting that by 2023, the result of that audit will begin to manifest. That is why we have projected 2023 to be N6.2 trillion.

“With the digitalization of the economy, we now sit in the comfort of our offices and homes to place order for the food that we eat. That became a big challenge to FIRS. With the digitalization of our tax administration, those taxes that were not visible to us are now becoming visible”, he stated.