Nigeria has a huge national debt and a revenue crisis.

    ABUJA — The country is experiencing a revenue crisis, according to Dr. Zacch Adedeji, the new chairman of the Federal Inland Revenue Service (FIRS), who made this statement yesterday.

    Approximately 96% of the Federal Government’s revenue was spent on debt payment last year, according to Adedeji, who made this statement as he took over the agency’s leadership from his predecessor, Muhammad Nami. He emphasized that the situation is unsustainable.

    Even still, as of mid-September, the federation account had N8.5 trillion in receipts, according to Nami, the former chairman of the revenue agency.

    Remember that one of the main reasons the government stopped subsidizing gasoline was a lack of funds to manage the nation’s affairs.

    “We are in a revenue crisis, with low government revenue and a significant public debt,” Adedeji added.
    96% of the government’s revenue last year went toward paying off debt.

    “Immediate actions must be taken to correct the situation where debt has grown faster than GDP and debt servicing has outpaced revenue.”

    firs building
    firs building

    Regarding his plans to maximize revenue generation, he stated: “In this area, therefore, we will key into the changes being undertaken by President Bola Tinubu who has since established a Presidential Fiscal Policy and Tax changes Committee.

    The committee’s mandate includes, among other things, developing an efficient plan for fiscal policy implementation and tax reforms for economic success.

    “At FIRS, we will support efforts to create a clean fiscal landscape for the nation and, in the process, address some of the challenges preventing the service from effectively carrying out its duties as the principal government body in charge of the administration, assessment, collection, accounting, and enforcement of taxes and levies.

    “We need to develop a hub of new concepts and creativity while also innovating and constructing our operations on reliable technology.”

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    In order to funnel all tax income into government coffers, the new tax-master promised to address systemic leaks.

    “Leaks must be stopped immediately. Our internal systems of governance must be strengthened. The efficient coordination of allocated activities and delegated duties must be highly valued, he continued.

    According to Adedeji, his team would involve stakeholders and educate them on the value of voluntary compliance, which will encourage taxpayers to voluntarily comply with their obligations.

    “No forcing things down stakeholders’ throats,”

    new firs boss
    new firs boss

    “Under me, we will not impose policies on our stakeholders,” he declared. I’ll always be available to talk to them, work with them, and through them to create a tax administration that everyone can be confident in and proud of.

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    “In general, we plan to develop a list of tactics that will encourage voluntary payment of taxes and levies.

    “Yes, this is feasible because Nigerians recognize that the government must raise revenues in order to fulfill its duties to them.

    “By doing this, we will create a tax system that is intelligent and contemporary, one that has unquestionable integrity, and one that will win the respect and trust of stakeholders.”

    Management and personnel were given the following instructions by Dr. Adedeji: “Work with uncompromising integrity, uphold taxpayers’ confidentiality, and demonstrate a high level of professionalism, fairness, and show exemplary public service.”

    This year, N8.5 trillion has already been collected, according to Nami.

    Muhammad Nami, the former chairman of FIRS, said in his speech that the organization was on track to establish a new income record in 2023 after collecting N8.5 as of September 14.

    The Nigerian National Petroleum Company Limited, NNPCL, was assessed by his administration throughout the time period under review, he said, and another N4 trillion was retrieved.

    Nami said that after achieving 10.86% in just two years, he had surpassed his four-year goal of 10% tax as a percentage of GDP.

    He claimed that the present administration’s 18% goal in four years was not only reachable but also possible to exceed.

    The FIRS established a revenue goal of N10 trillion for 2022 and collected N10.1 trillion during that time. Similar to 2023, with around four months left in the year, it set a target of N12 trillion in revenue and has already brought in N8.5 trillion.

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