FIRS Targets 1.8 Trillion Naira VAT Collection This Year
2017 may probably end up as the Year-of-Vat in Nigeria.
The Federal Inland Revenue Service, FIRS has set a record target of a whopping 1.8 trillion naira within this financial calendar.
With the government battling to fund a budget deficit of more than 2 trillion naira, this should be a welcome development.
The Executive Chairman of the service, Tunde Fowler, made the projection while defending the 2017 budget of the service before the Senate Committee on Finance on Tuesday in Abuja.
The budget, Fowler said, is aimed at increasing VAT and other sources of non-oil revenue.
He said VAT is aims to increase its value from 828 billion naira to a budget of 1.8 trillion naira, which is over 125% increase.
“The Service, in realisation of this responsibility and challenges of doing manual collection, has automated VAT collection for the critical sectors of the economy, notably telecommunications, airlines and financial institutions,’’ he said.
Fowler said that the service has proposed to achieve the tax revenue target as derived from the 2016-2018 Medium Term Revenue Framework (MTRF) for 2017, amounting to a total of 4.89 trillion naira.
However, the agency would be spending more money in the process of collecting the tax – about 153 billion naira higher than the 2016 approval estimate which stood at 144 billion Naira.
This shows the cost of collection increases from 6.63% on overall projected non-oil revenue, including VAT, stamp duties and levy.