The Federal Inland Revenue Service (FIRS) has explained that the mandate of the FIRS is to collect taxes that are due to the federation and the federal government of Nigeria and not to grant tax waivers to any taxpayer in the country.
Muhammad Nami, the Executive Chairman of the Service, had to provide this swift clarification in response to news making the rounds that companies like Dangote, Sinotruck Limited, Lafarge, Honeywell, among others, were granted tax waiver on pioneer status between 2019 and 2021, by the FIRS and other federal government agencies, amounting to N16 trillion
Nami in his explanation said that “FIRS does not have the power or responsibility of facilitating or even implementing tax waivers to investors in Nigeria as there are relevant agencies of government that are charged with such responsibility
He however, noted that the FIRS is not unmindful of the objectives of granting tax waivers to investors, which he said include “helping to grow local companies, stimulate economic growth, and earn investors’ confidence”.
Nami said he was, “confident that the companies, which are now enjoying tax breaks will eventually exit shortly and begin to pay taxes to the Federal Government as is currently being done by the companies that have equally enjoyed such tax breaks in the past and are now paying taxes in hundreds of billions of naira.
Such companies according to him, will continue to pay taxes to the government so long as they remain in business.
The FIRS Executive Chairman also clarified that “the companies enjoying the Pioneer Status will be exempted from paying only the Direct Taxes (eg CIT, EDT) from their profits but will continue to act as agents of collecting and remitting Indirect Taxes (eg VAT, WHT) in the ordinary course of their operations”.
Nami in conclusion, emphasised that he remained focused on the task of achieving the mandate of the Service which is to assess, collect, and account for taxes due to the federation and the Federal Government.
This task, he noted, “is challenging, more so at this time of global economic disruption occasioned by the Russia-Ukraine war and the Pandemic.
However, the Management is steadfast in achieving the target set for it by the Federal Government.
For instance, last year the Service surpassed its target by collecting an unprecedented amount of N6.4 trillion in taxes. So far this year, the Service is poised to perform even better than its record for last year.”
He then called on the stakeholders to join hands with him to grow the nation’s economy.