By Edwin Atabo
The recent report of improved revenue collection as contained in the 2020 second quarter performance report published by the Federal Inland Revenue Services (FIRS) is not surprising to experts and those who have a working knowledge of the new fiscal policy of the federal government under President Muhammadu Buhari. As has been attested to by professionals in public policy administration, the result explains the functionality, authenticity, validity and imperativeness of every policy.
There is, therefore, no doubt that the recent reforms at the FIRS are evidently functional, effective, timely and patriotic after all. Indeed, the outcomes of the reform speak volumes about the imperativeness of same.
According to the Q2 performance report, the FIRS exceeded its second quarter revenue target by generating the sum of N1.29 trillion in Q2 2020, that is N19.15billion in excess of the N1.27trillion target.
Details of the report showed that 34.2 per cent of the tax revenue was derived from petroleum profit taxes which stood at N440.3 billion while the balance of 65.8 per cent was generated from non-oil taxes which stood at the total sum of N848.1 billion. By implication, the total collection for Q2 2020 increased by 8.2 per cent compared to N1.19 trillion generated in the previous quarter, and 8.01 per cent increase compared to N1.4 trillion generated in the corresponding quarter of 2019.
The breakdown of the figures further revealed the following: Company Income Tax stood at N324.3 billion in the second quarter while Gas Income Tax was N77.7 billion. Similarly, import VAT collected by the Nigeria Customs Service (NCS) was N81.62 billion, while Non-import VAT stood at N245.6 billion.
Interestingly, the recently reinvigorated stamp duty collection by the Nami-led FIRS generated N62.6 billion as against a target of N4.3 billion, while capital gains tax stood N617.4 million. In the same vein, the newly reviewed VAT rate from five per cent to 7.5 per cent so as to increase Nigeria’s revenue base that nosedived as a result of the collapse of oil price at the international market equally surged up.
What this increased performance has revealed is the success of the patriotic reforms and innovation brought into the nation’s revenue collection by Muhammad Mamman Nami when he resumed work as the executive chairman of FIRS. What is striking in this wonderful performance within a short period of time is the fact that this record was attained at our country’s most critical period when COVID-19 pandemic is ravaging the entire global economy, with Nigeria suffering it more than most due to our mono-product economy.
Another point that the Nigerian public should not forget, and which should be boldly highlighted, is the fact that the last time the FIRS met its revenue target was in Q2 of 2015. The Revenue House then generated the sum of N1.19 trillion as against a target of N1.02 trillion, much to the applause of experts in the fiscal sector.
Remember too that this was a period of a general and a particularly fierce presidential election; it was a period between when President Muhammadu Buhari had just won his presidential election wherein he roundly defeated an incumbent and immediately after his swearing-in.
What this implies is indisputable fact that just like then, investors are ever confident in the business environment created by the present administration and are willing to invest their money. This is against the daily shrills of incurable pessimists who do not give this government any chance at all, churning dubious data, quoting questionable research organisations.
It is on this note that all well-meaning citizens of this country should support the ongoing reforms at the FIRS. I recall too that when he first introduced his reform agenda at the FIRS, there were a lot of scepticisms and fears being expressed by naysayers. But now, the nation is the ultimate beneficiary of his bold fiscal policies.
There is therefore the need for all stakeholders to continue to support the FIRS so as to sustain this record-breaking performance. It is also a wake-up call for the FIRS not to relent in its commitment towards strict implementation of its tax policies, especially the newly introduced stamp duty, VAT, etc. Expectations of Nigerians have now been heightened, hoping that next quarter performance will equally exceed last year’s Q3.
– Atabo is a Makurdi, Benue State-based public affairs analyst.