The Minister of Finance, Kemi Adeosun, says measures have been put in place to make it virtually impossible for contractors to obtain payments from the Federal Government without evidence of tax compliance.
Adeosun stated this at the 8th Annual Tax Conference of the Chartered Institute of Taxation of Nigeria in Abuja on Thursday.
Adeosun, who represented President Muhammadu Buhari at the event, said the move was part of recent initiatives by the Ministry of Finance to improve government’s tax collection system.
She said: “As part of our drive to increase non-oil revenue, we have set an aggressive target for increasing tax collection.
“This is a reflection of the fact that the current level of compliance is very low, and in some cases when there is compliance, the effective tax rate paid is lower than expected.
“We will use tax administration and technology to widen compliance and to encourage more individuals and companies into the tax net.
“In line with this objective, the government is investing in new technologies, training and other techniques to boost the efficiency of our collection.
“Some of the recent initiatives we have commenced in the Ministry of Finance made it now virtually impossible to obtain any payment, no matter how small, from the Federal Government without being fully tax compliant.
“Henceforth, before any payment is made, we will make a reference to the Federal Inland Revenue Service to confirm the tax status of that company.
“No tax, no payment.
“It is very simple.”
The minister said the current administration was fully conscious of the fact that tax payment was part of the social contract between government and the people.
She said the most effective measure to enforce compliance was the knowledge that tax revenues were being utilised effectively for the development of the people.
Adeosun said: “This we are ensuring our determined fight against corruption, which has been so debilitating and has robbed Nigeria of development.
“We are already implementing public financial management reforms to strengthen our financial controls as you advised last year and to ensure greater accountability.
“We are also making progress to ensure value for money in every naira spent by our efforts to reduce our overhead and increase the efficiency of our expenditure.
“We are committed to addressing the current infrastructure deficit, which is critical to enabling economic development.
“The mobilisation of government revenue driven by tax revenue is therefore paramount to meeting that significant investment that is now required.”
Adeosun lauded CITN for organising the conference, adding that by the chosen theme, the institute had clearly set out the fiscal priorities needed to underpin government’s economic agenda in a very concise manner.
While reassuring the nation that the economy would recover and emerge stronger, she urged CITN to indulge in economic patriotism that would ensure that skills were applied to get the best outcome for Nigerians.
She said: “Specifically, I implore you, in the spirit of change, to ensure that your advice to clients is always professional, legal, ethical and in the best interest of Nigeria.
“I urge you to avoid practices that are to the financial detriment of Nigeria and the greater good, and to avoid colluding with parties that are engaged in such detrimental practices.
“We in government are committed to making sure every naira counts.”
The President of CITN, Dr. Olateju Somorin, said the nation’s tax laws had become obsolete and must be reviewed to rake in substantial revenue from taxation.
Somorin said: “The institute has always been in the vanguard of calls for this review.
“Our tax laws must be enablers for voluntary tax compliance and not discourage same.
“Our tax laws must also be devoid of ambiguities and not give room for either tax payers or tax administrators to interpret same in inconsistent manner.”
Somorin also stressed the need for the country’s tax system to be well structured in a way that the framework for tax exemptions, tax incentives and waivers were streamlined.
The News Agency of Nigeria reports that the CITN annual conference is the single largest gathering of tax professionals both locally and internationally.
It offers delegates the opportunity to share ideas, forge partnerships, brainstorm on emerging and topical issues as they relate to tax profession and the environment.
NAN
