As today ushers in a new year, we serve you the events that will likely shape this 2019 in the banking /finance terrain.
The much-anticipated luxury tax is expected to take off any moment from now if hints from the Chairman of the Federal Inland Revenue Service (FIRS) , Mr. Babatunde Fowler, is anything to go by.
According to the FIRS boss , the Federal Government will implement the tax laws on special luxury items like private jets, yatchs, and the likes.
“We shall implement the special luxury items. The law is there but not yet implemented. It has been approved,” he said recently in Abuja.
In the banking sector, the mega merger between Diamond Bank Plc and Access Bank is expected to be consummated in March.
The transaction is to be concluded via Scheme of Merger following the two banks’ court ordered meetings. This is , however, subject to the approvals of shareholders, Securities and Exchange Commission (SEC), Central Bank of Nigeria (CBN), National Pension Commission (PENCOM) and the Federal High Court (FHC) expected before the end of first half of the year.
Te real sector of the economy, Small and Medium Enterprises (SMEs) and the agriculural sector is expected to witness an uptick in availability of funds this year.
According to CBN Governor, Godwin Emefiele, CBN “will explore the possibility of leveraging technology to enhance credit to critical sectors of the economy, especially, agriculture and manufacturing.
Our recently announced policy to refund portions of CRR to banks that are financing new projects (or expanding existing ones) in agriculture and manufacturing sectors will be intensified and enriched in the coming years. This, we believe, will bolster job creation while supporting our agenda to correct Nigeria’s imbalances and vulnerabilities.”
The apex bank has also expressed its determination to maintain its stable exchange policy stance this new year, given the relatively high level of reserves. “Gross stability is projected in the forex market given increased oil-related inflows and contained import bill. I will like to make it categorically clear that ‘sustaining a stable exchange rate is of overriding importance to us even as we continue to put measures in place to shore up reserves”, said Emefiele.
Inflation expected to shoot up this year.In fact, inflation rate is projected to rise to about 11.4 per cent due to political spendings this year..
With favourable oil price developments and continued efforts at driving indigenous production in high-
impact real sector activities, especially agriculture and manufacturing, the Gross Domestic Product (GDP) is expected to pick-up this year.
Although the incumbent Finance Minister, Mrs Zainab Ahmed, said that global economy is generally expected to slow down in 2019 with a modest growth of about 2.7 per cent.
The use of big data to trace the assets of tax dodgers may spike this year.
According to Mrs ahmed, this will help provide intelligence to the tax authority on eligible taxpayers and their real taxable incomes and assets.
Hear her: “We have implemented several initiatives targeted at recovery, including: Whistleblower unit that recovered over N8.5 billion and $465 million among others from the 1,051 investigations conducted from tip offs received.
Efficiency unit that has been charged with reviewing Federal Government’s overhead expenditures, Voluntary Assets and Income Declaration Scheme (VAIDS) under which over N35 billion was recovered with a significant recorded increase to our tax base. Asset tracing team that discovered assets that were not reported in the books of accounts of the Federation.
Going forward, we plan to launch Project Lighthouse that seeks to use of big data analytics to provide intelligence to the tax authority on eligible taxpayers and their real taxable incomes and assets.”
The Federal Government is expected to embark on aggressive revenue drive in 2019.
According to the Finance minister, this will be done through collaboration.
“On taxes for example, we have recorded an increase in number of registered taxpayers from 10 million in 2015 to about 19 million in 2018 under the Joint Tax Board (JTB). We have also fostered better comprehension of reported revenues between FAAC members and revenue generating entities as a result of the improved reporting template that we recently introduced.
“To take advantage of innovative technologies, we plan to leverage data, technological tools & platforms to foster collaboration, grow the revenue base and improve collections. Given the span of stakeholders that form our port community and for the sake of improving ease of doing business, we plan to deploy a national single window/trade platform that we expect to enhance customs collections to about 90 per cent.”
“The tax initiatives spearheaded by FIRS also include the automation VAT collection at source in some key sectors. Under my tenure as the Finance Minister, I intend to continue championing such digitalizatio, transformation initiatives that have proven to be a good way forward for our revenue generation drive.”
We will also improve collaboration between our revenue collection agencies including the Nigerian Customs Services (NCS), Federal Inland Revenue Service (FIRS) and other trade partners to share information and intelligence that will help improve revenue and make collections more efficient.
By automating many of our revenue collection processes such as the deployment of healthpay in the health sector, edupay in education and e-Collections by our Revenue Authorities, we have seen revenue shore up to record high levels. More specifically, FIRS deployed the e-Services platform that has automated the end to end tax process from registration to collection of Tax Clearance Certificate (TCC).
The tax initiatives spearheaded by FIRS also include the automation VAT collection at source in some key sectors. Under my tenure as the Finance Minister, I intend to continue championing such digitalization transformation initiatives that have proven to be a good way forward for our revenue generation drive.