The Federal Inland Revenue Service (FIRS) has successfully collected over ₦600 billion in Value Added Tax (VAT) from global digital service providers, including tech giants like Facebook, Amazon, and Netflix, according to Mr. Mathew Osanekwu, Special Adviser on Tax Policy to the Chairman of the Presidential Committee on Fiscal Policy and Tax Reforms.
Speaking at a media workshop in Abuja on Wednesday, Osanekwu revealed that amendments to the VAT Act under Section 10 have enabled the FIRS to bring non-resident companies into Nigeria’s tax net.
“These are not Nigerian entities, but they are now registered in Nigeria, paying VAT and acting as collection agents,” he stated, aligning the policy with global best practices to capture taxes from services consumed locally.
At the same event, the Federal Government addressed misconceptions about President Bola Tinubu’s ongoing fiscal and tax reforms, emphasizing that no new taxes have been introduced.
Professor Taiwo Oyedele, Chairman of the Presidential Committee on Fiscal Policy and Tax Reforms, clarified that levies like the debated 5% fuel surcharge predate the current administration and are rooted in existing laws.
“I challenge anyone to point to a single new tax introduced by this president,” Oyedele said, noting that Tinubu signed four executive orders in July 2023 to suspend taxes, including excise duties on plastics and vehicle imports, enacted in the waning days of the previous administration.
He also clarified that the Cybersecurity Levy, often misattributed to Tinubu, was legislated years earlier.
Set to take effect in January 2026, the tax reforms aim to overhaul Nigeria’s inefficient tax system, which has a tax-to-GDP ratio of 10.8%, significantly below the African average of 16% and the global benchmark of 30%.
Oyedele outlined a progressive framework designed to ease the burden on low- and middle-income earners while ensuring fairness.
Key measures include a personal income tax exemption for those earning below ₦800,000 annually and a 0% corporate tax rate for small businesses with annual revenues under ₦100 million.
“This is the most progressive tax reform Nigeria has ever seen, eliminating taxes on the poor and reducing the burden on the middle class,” he said.
Oyedele also highlighted Nigeria’s dire economic state in May 2023, when the country faced near collapse due to encumbered foreign reserves, subsidy-driven debt, and limited free crude oil availability.
He argued that continuing fuel subsidies, financed through borrowing against future oil production, could have led to a crisis akin to Sri Lanka’s fuel import shutdown.
“The question isn’t whether life is better now, but whether it would have been worse without these reforms,” he remarked.
The reforms aim to consolidate overlapping taxes, enhance compliance, and tie levies to transparent, project-specific spending, positioning Nigeria to broaden its revenue base while protecting vulnerable groups.
Click to signup for FREE news updates, latest information and hottest gists everyday
Advertise on NigerianEye.com to reach thousands of our daily users
No comments
Post a Comment
Kindly drop a comment below.
(Comments are moderated. Clean comments will be approved immediately)
Advert Enquires - Reach out to us at NigerianEye@gmail.com