The Federal Inland Revenue Service (FIRS) has so far collected N4.2 trillion revenue between January and September 2021.
Of the total collection, about N3.3 trillion representing over 77% is from the non-oil sector.
Oil-related taxes accounted for only 22 per cent, which is N950 billion.
FIRS Chairman, Muhammad Nami, made the disclosure at the public presentation and breakdown of the highlights of the 2022 Appropriation Bill in Abuja.
Nami restated that the diversification of the Nigerian economy, though a work in progress, is on course.
His words: “To address the issue of Nigeria not diversifying its economy, from a tax perspective, you will discover that we are actually diversifying the economy.
“The total collection we have up to 31st September, which we have not fully reconciled with the CBN and the Nigerian Customs is about N4.2 trillion, and from this amount, oil related taxes accounted for only 22 per cent which is N950 billion only, while the non-oil taxes we have generated within that period is N3.3 trillion.”
Nami noted that though the potentials of the country’s non-oil revenues were being harnessed, it was however not adequate.
“To discuss about the taxes that are being paid in the country and to say whether they are adequate or not, I want to believe one, they are not adequate,” he noted.
“People are not willing to pay even when they are appointed as agents of collection; whatever they have collected on behalf of the government they find it difficult to remit.
“When you compare Nigeria as an oil producing country to a small country like Saudi Arabia, we are still not there.
“We assume that we are a rich country, I don’t think that is correct. We only have the potential to be rich, because we have a very huge population of about 200 million.
“Saudi Arabia with a population of about 35 million people has an oil firm, ARAMCO that raked in $49 billion in profit in 2020. At our official rate, that is roughly about N20 trillion in profit: more than the total budget sum for 2022 that was submitted by President Muhammadu Buhari.
“Despite the above statistics, Saudi Arabia still earns revenue from several other sources including religious tourism and Value Added Tax (VAT) which is as high as 15%, as against Nigeria’s 7.5%.”
The FIRS Executive Chairman emphasized that the best way to fund budgets globally was through payment of taxes by citizens particularly personal income tax which is a direct tax as against indirect taxes.
He further noted that personal income taxes in other countries account for over 50% of the funds available to their respective governments for funding expenditure.
“Our total taxpayers today is in the region of about 41 million people and the total personal income tax paid last year was less than N1 trillion by 40 million people.
“If you also compare that with our own brother South Africa where they have a total population of about 60 million people, with just 4 million taxpayers, the total personal income tax paid in South Africa last year is about N13 trillion. You can now see that these things are not adding up.
“The number of billionaires in Lagos alone are more than the number of billionaires in the whole of South Africa but yet what Lagos State generated as Personal Income Tax was just less than N400 billion in 2020.
“So if we don’t pay these taxes, there is no way the government will be able to provide the social amenities required, the critical infrastructure required for the wellbeing of the country,” Nami stated.
- Alex Otti should publish Abia Forensic Report now - May 1, 2024
- FG approves 25%, 35% salary increment for civil servants - April 30, 2024
- CBN director: How I collected $600,000 contract bribe for Emefiele - April 29, 2024
