Nigeria’s has only 10 million individuals paying tax – Fowler

The Chairman, Federal Inland Revenue Service, Mr Tunde Fowler, says the total tax base for individuals in Nigeria is 10 million.

Fowler said this at the 2016 Tax Week of the Chartered Institute of Taxation of Nigeria (CITN) with the theme: “The dilemma of improving tax revenue generation in tough economic times’’ on Tuesday in Abuja.

He said that taxation was based on profit and income therefore people must pay tax.

Fowler said that in spite of the present economic situation, there are certain sectors of the economy that were still doing quite well, generating enough profit.

“All we are saying is they should pay taxes, for individuals who are not doing well, the tax also is not very high and for those who are not making any income, there is no tax.

“Looking at membership in the small scale sector, they are said to have 37.5 million members; the total tax base for individuals in Nigeria is 10 million, so there’s a short fall of over 27.5 million.

“When you look at the corporate sectors as well, half a million are not paying taxes, some are collecting VAT but are not remitting to government.

“Some have deducted, including taxes and stopped remitting and some have just stopped being paid income.

“Now it has gotten to a stage of enforcement and we make sure that all these taxes are collected,’’ Fowler said.

The Chairman said that revenue collected in the second quarter was high; adding that revenue collected by the service in in the first quarter was quite low.

“In terms of actual collections of the second quarter, it was close to 90 per cent.

“Looking at it cumulatively, first and second quarter is about 73 per cent so we hope to achieve a 100 per cent rate this year.

“You got to realise that revenue is seasonal and I wouldn’t want to give the wrong impression that we have collected as much as we should have.

“All we are saying is that those who are making income and making profit pay your taxes,’’ he added.

CITN President and Chairman of the Council, Dr Teju Somorin, said that government must do what was required to diversify resource to achieve the desired goal of the country.

Somorin said that the aim of the tax week was to deliberate on topical issues affecting taxation in the country and come up with recommendations.

“I believe that the recommendations that will come out of the deliberation will get to the relevant stakeholders for implementation.

The Chairman, CITN Abuja and District Society, Mr Simon Kato, said that if government wanted to diversify, there must be need to increase productivity.

“One thing that we hope this tax week will bring out is that we will be making recommendations to government to ensure that the tax process is made much simple a convenient for the tax payer.

“It is our desire to see that we reach that time where tax as a whole will be a one stop payment in this country, where you don’t have to pay taxes at different locations which is the situation we have with the multiple taxation complaints.”

“My advice to government is that we must look inwards; the issue of diversification we are talking about has to be practical.

“If you want to diversify, you need to ensure that you open room for increased productivity,’’ Kato said.