The Executive Chairman, Federal Inland Revenue Service (FIRS), Alhaji Kabir Mashi, said efforts are on to amend the Value Added Tax (VAT) Act. Mashi, who made this known at the opening of a nationwide VAT enlightenment campaign Monday in Abuja, said the amendment would help resolve silent issues as regards VAT and shore up revenue from taxation.
This revelation is coming as the Service has so far collected N590.29 billion as its VAT component to the total tax collection from January to October. FIRS realised a total of N3.8 trillion between January and September.
According to Mashi, even though VAT was introduced in 1993 to Nigeria, it has become a major contributor to tax collection, providing an average of about 16 percent of total collection in the last eight years.
He said that VAT collection had grown from N163.3 billion in 2004 to N659.1 billion in 2011, representing an increase of more than 400 percent and that VAT is the third highest contributor to tax collection in the last eight years.
“Notwithstanding this impressive performance from VAT, we believe that there is significant room for increase tax collection from VAT and this is why we have interactions of this nature with taxpayers.”
We are aware of the challenges faced by taxpayers in complying with the VAT law and we are working to resolve these challenges. We are currently in the process of reviewing the Value Added Tax Act and we will soon come up with a draft VAT Amendment Bill, which will help to resolve these issues.
In addition, we are constantly providing specialised training to our tax officers to enable them respond professionally to any queries or requests from taxpayers in the tax offices. These are geared towards providing efficient taxpayers services and promoting
voluntary compliance,’’ Mashi explained.
He said that FIRS needs to provide direct enlightenment in specific areas of taxation to the general public as part of the Service overall taxpayer education processes and bridge taxpayer knowledge on taxation.
Earlier, Mr. Onyekachi Ihedioha, Coordinating Director, Direct Report Group (DRG), said the event aimed at evaluating VAT performance as regards rights and obligations of the taxpayers and how the evaluation could impact on the propose VAT law review.
He said that the Service at the core of its drive for revenue needed to let the public know about their rights, obligations and the law, adding that: “It is important that we collectively review all grey areas of the law; answer your questions and provide a guide for you to do the right thing
The VAT was introduced by the Value Added Tax Decree No 103 of 1993 as a consumption tax on specified goods and services.
The Decree states the goods and services exempted from VAT to include Medical and Pharmaceutical products, basic food items, books and education materials, baby products, agricultural equipments and products and veterinary medicine, fertilizers, agricultural chemicals and exported goods.
Others are services by microfinance banks and mortgage institutions, plays and performances conducted by educational institutions as part of learning, religious services and exported services.No tags for this post.