- Federal Inland Revenue Service (FIRS) emphasised that the informal sector presents unique challenges, as many small and micro businesses operate outside the formal tax system
- The government disclosed plans to introduce simplified tax regimes and incentives to better engage the informal sector
- Zacch Adedeji, the Executive Chairman of the revenue service highlighted the need for ongoing innovation in the tax system to support sustainable growth and equitable development in Nigeria
To enhance Nigeria’s tax system, the Federal Inland Revenue Service (FIRS) is considering a range of incentives to engage those operating in the informal sector.
Zacch Adedeji, the Executive Chairman of FIRS, disclosed this in a statement during the Private Sector Stakeholders’ Engagement co-hosted by the Lagos Chamber of Commerce and Industry (LCCI) and FIRS, titled “Emerging Tax Matters” in Lagos on Wednesday, September 18.
FIRS discloses need for transparency and effectiveness
“As we explore various tax incentives to stimulate local industries, we must emphasize the need for transparency and effectiveness in the implementation of these incentives. Evaluating their impact and ensuring they align with national development goals is critical for maximizing their benefits.
Represented by Mrs Oti Olaniyi, Acting Director of the Medium Taxpayers Department (South) at FIRS, Adedeji highlighted the unique challenges posed by the informal sector, which makes up a significant portion of the economy.
Government plans simplified tax regimes for small businesses
“The informal sector, which constitutes a large part of our economy, poses unique challenges. Many small and micro businesses operate outside the formal tax system. To engage this sector effectively, the government is exploring simplified tax regimes and registration incentives.
He also announced that FIRS will soon launch the FIRS e-Invoice to simplify tax payments.
The statement read, “The recent restructuring of the FIRS into three operational groups – Small/Emerging Taxpayers, Medium Taxpayers, and Large Taxpayers – allows for a more focused approach in managing and supporting different segments of taxpayers.”
He further said, “As we move forward, we must continue to innovate and enhance our tax system. Soon, we will introduce the FIRS e-Invoice, a digital solution for managing invoices in line with the Tax Administration and Enforcement Act 2007.
Emerging tax matters present both challenges and opportunities, Adedeji
“This initiative, as part of our Digital Transformation Strategy, will facilitate real-time transaction validation and storage, benefiting Business-to-Business, Business-to-Consumer, and Business-to-Government transactions.
“The emerging tax matters in Nigeria present both challenges and opportunities. By embracing reform, leveraging technology, and ensuring transparency, we can develop a tax system that supports sustainable growth and equitable development. Our collective efforts will pave the way for a more prosperous and resilient Nigeria.”
7 tax reforms by Tinubu administration that affect every Nigerian
Meanwhile, TheRadar earlier reported that the administration of President Bola Tinubu has introduced a number of tax reforms.
The report highlighted the administration's tax reforms that had been implemented through a series of executive orders and legislative changes.