…LCCI Welcomes Transformation
The Executive Chairman of Federal Inland Revenue Service (FIRS), Zaccheous Adedeji, during an engagement with the organised private sector on ‘Emerging Tax Matters’, announced the introduction of an electronic invoice (e-invoice) to improve the tax system in Nigeria.
Adedeji, at the summit on Wednesday in Lagos, represented by the Acting Director of the Medium Taxpayers Department FIRS, Oti Olaniyi, said the“E-invoice” was necessary to innovate and enhance the tax system.
Adedeji said the initiative, a digital solution for managing invoices, is in line with the Tax Administration and Enforcement Act 2007.
According to the FIRS boss, it is also part of the FIRS’s digital transformation strategy and would facilitate real-time transaction validation and storage that will benefit business-to-business, business-to-consumer, and business-to-government transactions.
“Our collective efforts will pave the way for a more prosperous and resilient Nigeria,” Adedeji said.
“As we move forward, we encourage you to support these initiatives with constructive feedback and collaboration.
“By doing so, we can all build a stronger, more resilient economy that benefits everyone,” the taxman said.
According to Adedeji, Nigeria has gotten to a crucial juncture in its economic evolution and must explore various tax incentives to stimulate local industries, adding that the e-invoice could develop a tax system that supports sustainable growth and equitable development.
He said to engage the informal sector effectively, the government would explore simplified tax regimes and registration incentives as the sector constitutes a large part of the economy, which posed unique challenges with their operations outside the formal tax system.
Commending the approach, the President of the Lagos Chamber of Commerce and Industry (LCCI), Gabriel Idahosa, urged the FIRS to collaborate with the private sector and government to ensure that tax policies support business innovation and competitiveness.
He said under its new leadership, the FIRS had set ambitious goals to increase tax collection by 57 per cent, targeting revenue of N19.4tn for 2024.
Subsequently, he noted that the country’s current tax-to-gross domestic product (GDP) ratio stood at 10.86 per cent, with the government target of a tax-to-GDP ratio of 18 per cent within the next three years.
Idahosa said the target was achievable, however, requires a concerted effort from both the public and private sectors on trust and transparency.
He said, “There is also a growing need for collaboration between the private sector and the government to ensure that tax policies support business innovation and competitiveness.
“For instance, recommending tax breaks for wage increases and removing barriers to foreign currency-denominated transactions can create a more robust investment environment.
“As we move forward in 2024, Nigeria’s fiscal policy is at a critical juncture; the drive to expand the tax net, streamline the system and boost compliance is essential for securing Nigeria’s economic future.”