Dr. Cyril Ikemefuna Nwobodo Ede the immediate President of the Chartered Institute of Taxation of Nigeria (CITN) For us to be truly seen as making a determined push to diversify the economy away from taxes, what we require is a sustained effort towards investing in critical infrastructure such as power and transportation which impacts greatly on industrial development. I am delighted that government is gradually taking decisive steps in this direction as evidenced on ongoing rails projects, major road rehabilitation and reconstruction in key arterial roads, investments in power generation and transmission projects etc. When these initiatives are sustained, in no time, the right environment would be created for investors to set up businesses that would operate profitably, conserve foreign exchange, reduce unemployment and pay taxes to government.He spoke to New Fortunes recently on topical issues bordering on the economy, taxation, revenue diversification, financial reporting, among others; and harped on the need for an uptick in Nigeria’s non-oil revenue stream.
VAIDS assessment
On the whole, I would say the programme was successful, not really in terms of numbers but the awareness generated. The publicity accorded the VAIDS programme impacted on the level of awareness and perception of Nigerians on the need to be tax compliant. Our Institute was involved in the sensitization campaign for the programme and our assessment of the feedback generated supports the fact that the programme lived up to expectations. We can only hope that in future there should be better synergy amongst the tax authorities at the federal and state level towards a successful run. By default, response to any government pronouncement, policy or programme is to shuttle between indifference and skepticism. Only in very few instances have I felt a government programme has a chance of success. But report has shown that in the first four months of implementation, VAIDS delivered N17billion into government coffers. Two months later, an additional N6billion was realised through the scheme.
Tax Appeal Tribunals
The Federal Government reconstituted the tax appeal tribunals in the six geo-political zones as well as Lagos and Federal Capital Territory. The reconstitution of the tribunals is in accordance with Section 2(1) of the Fifth Schedule of the Federal Inland Revenue Service Establishment Act. We commend the Minister of Finance for inaugurating the Tax Appeal Tribunals, though it was long overdue. An effective tax system requires a tax dispute resolution mechanism that can speedily resolve disputes between the taxpayers and the tax authorities thereby giving credence to the tax system. Therefore, the place of the Tax Appeal Tribunals cannot be over-emphasized. It is necessary for tax justice and capable of engendering confidence in the minds of the taxpayers and by extension increasing tax compliance levels. It is also capable of attracting investors to the economy as they would be assured that our tax system is robust and caters for the needs of all stakeholders.
FIRS target
Firstly, I would like to commend the FIRS for the record performance in 2018 though it fell short of the revenue projections for the year (FIRS recorded N5.3 trillion tax revenue in 2018, as against N6.7 trillion target). In spite of the difficult operating environment, the Service was innovative in its approach to mobilizing revenue, through novel initiatives such as the activation of the e-tax platforms and other enforcement drive. On what accounts for the shortfall in relation to the revenue projections, we must appreciate that taxes are flows from economic activities. There are lots of intervening variables that come into play in this regard which can affect such revenue projections. I am hopeful that in the not too distant time, coupled with sustained reforms in the tax administration and improved economic indices, the FIRS would be able to meet if not surpass its revenue projections.
Diversification
We are making progress towards diversifying the economy away from reliance on oil to non-oil revenue. However, the progress has been slow. If the figures from collections made by the FIRS last year are considered as a basis, it shows that we had over 50 per cent of the total revenue collection from non-oil sources which may be considered remarkable. However, this improvement in non-oil revenue is a derivative of the cyclical effect of activities in the oil and gas sector. This is why when there is a significant drop in oil prices, it affects overall revenue projections. For us to be truly seen as making a determined push to diversify the economy away from taxes, what we require is a sustained effort towards investing in critical infrastructure such as power and transportation which impacts greatly on industrial development. I am delighted that government is gradually taking decisive steps in this direction as evidenced on ongoing rails projects, major road rehabilitation and reconstruction in key arterial roads, investments in power generation and transmission projects etc. When these initiatives are sustained, in no time, the right environment would be created for investors to set up businesses that would operate profitably, conserve foreign exchange, reduce unemployment and pay taxes to government.
Quackery
It is in order to check the trend of quackery and unprofessional conduct that we are advocating that the various tax authorities should work with the Institute by insisting that those who file returns on behalf of taxpayers are licensed to do so by the CITN. As you are aware, CITN is empowered by its enabling charter to regulate the tax profession in Nigeria. We believe that if this is in place, there would be professionalism which would translate to a better tax system for the country.
Achievements
I drew up an eight-point agenda as the focus of my presidency which is being given priority. The focal area is; increased visibility of CITN, Staff Welfare, Joint District Societies Restructuring, Recovery of Outstanding Subscriptions from members, Creation of other sources of revenue, Giving greater value for CITN certificate, stamp and seal, Enhancement of stakeholder’s collaboration and Actualization of the Tax Academy project. So far, with the support of Council of the Institute, we have recorded modest achievements which are legacies upon which successive leadership of the Institute can build upon. With regards to specifics, already, we have registered the CITN Tax Academy, put in place the Board, have purchased land for the Academy in Kwara State and programmes have commenced in earnest. With these steps, the Tax Academy Project is being actualized.
In the course of my presidency, our visibility as an Institute was entrenched with well thought-out initiatives. Our Districts Societies are now actively promoting the Institute at the local level with high profile events, constant engagements with stakeholders and quality contributions to tax and fiscal policy issues. In fact, District Societies are now competitive in their approach to delivering on their mandates, which is good for the Institute. In terms of collaboration with stakeholders, we were able to consummate agreements for collaboration with a number of organisations. Details of some of these organisations and the scope of the agreement are in the public domain. CITN has also actively contributed to fiscal policy issues with a number of position papers presented to relevant stakeholders. For the first time ever, we regularly published our four editions of the Journal of Taxation and Economic Development. This also applies to our newsletter. We scored a number of firsts during my presidency with the institution of the International Academic Tax Conference. The inaugural edition was held in August last year at the Nasarawa State University, Keffi. We successfully organised two zonal tax conferences with the 3rd of the 4th edition to be organized before the end of my tenure. This is a significant achievement, which is having a huge impact at the zonal level in terms of tax advocacy and enlightenment.
Culled from New Fortunes magazine