The 36 states of the federation grew their combined Internally Generated Revenue (IGR) by N360 billion in two years. They grew the IGR from N1.31 trillion in 2019 to N1.67 trillion in 2021. Chairman of the Nigeria Governors Forum (NGF), Gov. Kayode Fayemi of Ekiti said this in Abuja at the 8th IGR Peer Learning Event and launch of the NGF public finance database. He said the share of IGR in total recurrent revenue of the states also rose from 31 per cent in 2019 to 35 per cent in 202. Fayemi attributed the improvement to the conscious reforms in tax administration in the states.
“Consensus reforms were focused on ending multiple taxation; professionalising and modernising our revenue services; embracing a tax payer-centric culture that eases compliance and strengthens the existing social contract. What we need to do better is to foster an enabling tax environment and administration that allows us to optimise our revenue potential as sub-nationals. Our pursuit to do things differently has benefitted from the relentless efforts of our state officials, technical assistance programmes within our Secretariat and from partners’ support,’’ he said. Fayemi added that collaborations and support had ensured that states stayed on the course of implementation, delivering far reaching reforms, which yielded the results. He said, however, that state governments must occasionally respond to the fast-changing tax environment if they must stay ahead of evasion and avoidance tactics.
He said that attention must be paid to the emerging dynamics surrounding private income. He listed the dynamics to include devaluation effect of rising inflation rate, structural transition in employment, business dealings and investments driven by the evolution of technology. Fayemi advised his governor colleagues to examine ways of expanding their tax nets and improve the tax payer database. He argued that this would require ending the proliferation of tax payers’ identification numbers and databases. “It is pertinent that we harmonise; leveraging a unique identification number as it is the global best practice. For us to achieve this, information sharing between jurisdictions must be seamless, not only between the tiers of government, but also inter and intra-state,’’ he stressed.
The chairman called on the Joint Tax Board to find solution to the problem of inadequate information sharing between states to improve on transparency in tax revenues and also in the entire treasury. He stated that the database, which was launched at the occasion, would allow users to easily filter and analyse states’ fiscal data and information. “We understand the need to build greater accountability, especially showing citizens the linkage between their taxes and service delivery. We are working with our revenue services and with Ministries, Departments and Agencies to expand our tax-for-service initiatives in rewarding compliance, while ensuring that citizens knew where we expend their taxes annually,’’ he added. Fayemi expressed the hope that the governors’ successors would continue the reforms.
The Director-General of the NGF, Asishana Okauru, assured that the Forum would continue to play an active role in mainstreaming tax programmes through advocacy. He said the tax database portal would host comparable annual data on government spending, revenues, and financing in all states of the federation. “This will feature hundreds of performance indicators that measure the quality of public spending and the intersection of public financial management and service delivery,’’ he said. (NAN)