Nigeria Governors Forum (NGF), the umbrella body of the thirty- state governors said that if domestic revenue mobilisation must be increased in the country, there was the urgent need to work on weak environment and technological integration. The forum has however identified weak environment and low technological integration in tax administration as the major problem affecting the mobilisation of revenues for economic development. Speaking in Abuja at the Forum’s Technology Tax event, NGF’s Director-General, Asishana Okauru lamented that these factors have undermined the capacity of tax authorities to collect taxes efficiently and the ability of taxpayers to meet their tax responsibilities conveniently.
According to him, the NGF has already alerted that most contact-intensive taxes are at risk, adding that during the period of the lockdown where taxes collected from contact-intensive taxes fell by an average of 40 percent across all States in Nigeria. Okauru who noted that the lessons of the COVID-19 pandemic have exposed the fact that all revenue administrations need to move to a digital future, however maintained that digitalisation does not only bring about efficiency. The NGF Director General who noted that digitalisation also provides opportunities for more people to be involved, said, “Specifically for tax authorities, one big lesson that we have learnt is the criticality of internet-based business support systems and payment platforms for the automation of all back-end operational processes and payments across all revenue streams.”
Okauru said that the forum has taken steps to bring together technology providers, service providers and researchers in the tax space into one network as part of moves to take advantage of the innovation that is taking place, said that the NGF will continue to do its best to bring such collaborations together to provide opportunities for States to benefit from a global perspective and to ensure no state is left behind. Okauru said, “historically many governments have taken the path of least resistance, maintaining tax systems that allow them to maximise whatever limited options are available rather than expanding into digital and more efficient tax systems. Amidst this transformation, we also recognise risks of data ownership, data protection and cyber security. This each government must envisage. It would require a strong in-house IT team and an experienced legal department that will help protect the interest of all parties, including taxpayers.
“The pathways to achieving tax digitalisation may vary from State to State but the conditions remain the same, including providing broadband access and supporting the growth of digital skills in the wider economy. Luckily, payment providers and governments in regions that have lagged in digitisation, in many cases, possess greater potential for revenue increase in the digital future. The goal for us is to help facilitate the scale up of modern, taxpayer-friendly, and technology-driven revenue administrations in all States of the federation that will be capable of providing world-class services, characterised by efficient, paperless operations, and equipped with ICT-enabled risk-based enforcement capable of optimising their revenue mobilisation strategies.”
In his remarks, Chairman, Federal Inland Revenue Service (FIRS), Mohammad Nami who stressed the need to look inwards on how to improve the revenue of the states to augment the shortfall of allocations from the Federation Account, said that taxation all over the world has always been the most reliable and sustainable source of government revenue if well harnessed and effectively administered. Nami who lamented that the reliance on oil revenue in the previous years has exposed the country to huge revenue challenges and resulted in poor budget implementation across the three tiers, said, “There is no better time for a national programme of this nature than now when there is a very pertinent need to shore up our revenue in other to meet the budgetary gaps facing the Federal and State Governments.
“There is also the need to look inwards on how to improve the revenue of the states to augment the shortfall of allocations from the Federation Account. Over time, taxation all over the world has always been the most reliable and sustainable source of government revenue if well harnessed and effectively administered. For us as a mono-product economy, the reliance on oil revenue in the previous years has exposed our dear country to huge revenue challenges and resulted in poor budget implementation across the three tiers. Therefore, proffering solution to these nagging revenue challenges requires a deliberate strategic action plan hence the need and justification for today’s event. Taxation, in most advanced jurisdictions, has gone beyond the bricks-and-mortar model but relies more on data and intelligence which are driven by technology. The adoption of technology in revenue administration processes is crucial and a major enabler for enhanced and sustainable revenue generation in a globalized and knowledge-driven world.
“Therefore, revenue authorities at all levels must adopt automated processes and embrace e-solutions both in their internal operations and in dealing with the taxpayers within their respective jurisdictions. The need to embrace technology in tax administration was the basis for the choice of our theme, “Leveraging on Technology Solution for Enhanced Administration of Indirect Taxes”, at the 145th Joint Tax Board Meeting. The JTB meeting harped on the need to further broaden and increase revenue generation at all levels by leveraging on ICT and that the adoption of technology will optimise and harness the various taxes and plug revenue leakages. The FIRS as the country’s leading tax institution has taken some steps at automating its processes from e-registration, e-filing, e-payment, e-receipt, e-collection and e-TCC, to ensure that we improve on collections. We have recently launched our proprietary e-solution platform – TaxPro Max- a solution developed by the FIRS for effective and integrated e-tax administration. There is also the ongoing automation and real-time VAT collection and reporting system in addition to our leveraging on technology in enhancing the exchange of information with taxpayers as provided in the Finance Act 2020.”
