The Federal Inland Revenue Service (FIRS) has set its sights on achieving a value added tax (VAT) revenue of N5 trillion in 2024.
This is as a part of efforts to boost government income and address tax gaps.
The announcement was made by the FIRS Chairman, Mr. Zacch Adedeji, during a press conference in Abuja on Thursday, March 28, 2024.
Mr. Adedeji highlighted the increasing trend in VAT revenue, citing figures of N1.9 trillion, N1.5 trillion, N2.5 trillion, N2.3 trillion, and N3.6 trillion for the years 2019 to 2023 respectively.
The service is also aligning its strategies with the Economic Community of West Africa State’s (ECOWAS) directive on tax reform, particularly Article 30, which allows member states to set VAT rates between 5 percent and 20 percent.
Discussions are underway at the National Assembly to pass VAT reform into law, with expectations that this move will contribute to achieving the targeted N5 trillion VAT revenue.
Efforts to expand the scope of VAT collection include taxing non-resident resource suppliers like Google and Amazon, as well as utilising collection agents such as deposit money banks (DMBs) and telecommunication companies.
The FIRS is also collaborating with the United Nations Development Programme (UNDP) to train workers on VAT gap analysis, with the aim of enhancing VAT collection efficiency and reaching the revenue target of N5 trillion by 2024.
The European Union (EU) delegation to Nigeria has expressed support for the FIRS’s initiatives, emphasizing the need for improved tax revenue mobilization in Nigeria. Despite challenges related to citizens’ perceptions of tax utilization, stakeholders are optimistic about the prospects of achieving the set VAT revenue target and strengthening tax systems in Nigeria.
