Taiwo Oyedele, chairman of the presidential fiscal policy and tax reforms committee, says Nigerian businesses are strained due to taxes paid in foreign currency.
Speaking at the Nigerian Financial Intelligence Unit (NFIU) first revenue assurance summit, Oyedele said businesses are required to pay certain taxes in dollars, which amounts to an estimated $3.5 billion annually.
According to Oyedele, the practice not only strains local businesses but also contributes to the depreciation of the naira.
“We found that Nigerian businesses are being asked to pay some taxes in dollars — NIMASA, NPA, etc. which amounts to an estimated $3.5 billion a year,” the chairman said.
“We are crying that our naira is losing value; why wouldn’t it lose value when we impose unnecessary dollar demands?”
In his address, titled “The Importance of Revenue Assurance in Economic Stability,” Oyedele noted that revenue should be used to enhance the lives and livelihoods of citizens rather than simply serving as a financial target.
He called for a coherent policy environment that fosters investment and collaboration among federal and state agencies.
‘RELEASE DATA IN 48 HOURS OR FACE CONSEQUENCES’
Oyedele warned government agencies against withholding data from each other, noting that the data does not belong to them.
Giving an instance, Oyedele said the Joint Tax Board (JTB) was required to pay for data access from governmental sources.
He questioned how the government would generate revenue if the agencies were selling data.
To prevent government agencies from withholding data, Oyedele announced plans to draft legislation mandating the free provision of government-held data, with strict deadlines for compliance.
“Our economy must be designed to be conducive and investment friendly, our policy environment must be purposeful and coherent, let’s not be pulling in different directions, states versus federal or even within federal agencies.
“JTB (Joint Tax Bank) told me as part of the work we are doing, the number of agencies they were looking for data, you know they were commending the NFIU and we are grateful for the NFIU and the leadership… and they were asking them to come and pay for data.
“JTB was being asked to pay for data I couldn’t believe it. In the same Nigeria, government has data and government is selling data and we say government does not have revenue,” he said.
“How are we suppose to have revenue if we are selling data?
“So we drafted a law, it is not your data, it is our data, you will give it. In fact we will give you a deadline of 48 hours. If you don’t release the data, there will be consequences. We are criminalising it. Give the data.”
He further stressed the necessity of linking domestic data with international standards to ensure the integrity of information while making revenue collection processes efficient and transparent.
Oyedele said protocols are being developed to ensure data integrity and protection.
‘FOCUS ON PROBLEM-SOLVING RATHER THAN OBSTRUCTING EFFORTS’
Addressing misinformation surrounding his committee’s initiatives, Oyedele criticised unfounded claims about fiscal policies, particularly a recent report alleging the committee announced a 10 percent reduction in federal government allocations from the federal account allocation committee (FAAC).
On October 13, Oyedele denied proposing a reduction in the federal government’s share of revenue from FAAC.
He said his committee’s recommendation was explicitly in respect of the value-added tax (VAT) revenue.
Speaking on the issue, the chairman urged stakeholders to focus on problem-solving rather than obstructing efforts to improve the economy.
‘EFFECTIVE COLLECTION OF TAXES WILL INCREASE REVENUES WITHIN 3 YEARS’
Oyedele announced that the committee has proposed a synchronised tax system that includes eight key taxes across federal, state, and local levels.
He said the effective collection of the taxes could result in a four- to five-fold increase in revenues within two to three years.
Additionally, Oyedele proposed a national framework for subsidies aimed at alleviating financial pressures on businesses, expressing hope that political leaders will adopt the reforms while calling for unity among stakeholders in implementing the reforms.
In her remarks, Hafsat Bakari, chief executive officer (CEO) of the NFIU, said while the unit’s work on tax crimes initially focused on supporting the Federal Inland Revenue Service (FIRS), NFIU has now expanded its efforts to partner with sub-national counterparts.
Bakari said most tax evasion occurs at the state level and that financial transaction data held by the NFIU would greatly benefit state internal revenue services.
“While FIUs were created by international conventions to address criminal activity, the same international conventions and standards require that we put in place measures to protect the integrity of the information that we provide,” Bakari said.
“To this end, our approach to working with States is built on the establishment of a memorandum of understanding which sets out the principles, objectives and limitations of the intelligence provided.”
She also announced the creation of the crime records information management system (CRIMS), a secure platform for requesting and receiving intelligence from the agency.
Bakari said through CRIMS, paper records, which are prone to compromise, have been eliminated.
