Mr. Muhammad Nami, the Executive Chairman of the Federal Inland Revenue Service (FIRS), has stated that the FIRS is tasked with tax collection and not granting tax waivers. Mr. Nami stated this as a reaction to recent news that large companies like Dangote, Lafarge, Honeywell, and so on, had been granted tax waivers to the tune of NGN16.79 trn by the FIRS from 2019 to 2021.
In a statement on Monday, 19th September 2022, the Chairman, through his Special Assistant on Media & Communication, Mr. Johannes Wojuola, noted that “FIRS does not have the power or responsibility of facilitating or even implementing tax waivers to investors in Nigeria. There are relevant agencies of government that are charged with such responsibility.”
He stated that FIRS, nonetheless, understands the reasons why some companies might be granted tax waivers and that he is “…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.”
Mr. Nami further explained that companies enjoying tax breaks through the Pioneer Status Incentive are only exempted from paying Direct Taxes, such as the Companies Income Tax (CIT) and the Education Tax (EDT) from their profits. They “…will continue to act as agents of collecting and remitting Indirect Taxes (e.g. VAT, WHT) in the ordinary course of their operations”.
The Chairman, in his statement, also reiterated that he remains committed to achieving the mandate of the Service, in spite of the current global economic disruption brought about by the Russia-Ukraine war and the COVID-19 Pandemic. He cited last year’s unprecedented tax collection of NGN6.4 trn as an indicator of his commitment and called on all relevant stakeholders to support his quest for national economic growth.
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