FROM taxpayers came a call yesterday for the introduction of property tax as a strategy of improving government revenue and distributing the tax band away from low income earners.
Mr. Julius Offodile, led other taxpayers to make this call yesterday in Abuja at a stakeholders interactive forum, by the Federal Inland Revenue Service, FIRS, where the agency’s Ag. Executive Chairman, Alhaji Kabir Mashi, encouraged taxpayers to open up and speak on areas of tax administration which they are not comfortable with.
At the forum organized by the Large and Medium Tax Departments of the FIRS, some taxpayers suggested that government should make laws that would bring property owners to tax net and make them pay taxes on their properties.
FIRS Ag. Chairman, Alhaji Mashi, encouraged the taxpayers to open up and let FIRS know their feelings and suggestions on how to make tax administration in Nigeria convenient for both the government and taxpayers.
Mashi said FIRS had designed the interactive forum “as an avenue for confidence building between taxpayers—who are our major stakeholders—and FIRS in order to provide taxpayers with quality service”.
Sid the FIRS Chairman: “Please be free to walk into any of our offices nearest to you during our operating hours, 8.30am to 5.00pm, Mondays to Fridays, for your enquiries and relevant guidance whenever the need arises.
“Just as we have obligations to you the taxpayers on one hand, we also have obligations to the government of the federation on the other hand. The task of collecting taxes is an enormous responsibility. We live in the same society and we are also confronted daily with the challenges of doing business in the society. This however, is not peculiar to our country. The crises affecting the economies of the world have had its fair share on our economy in this country. Hence we are developing strategies on the way forward and at every opportunity, we emphasise to all concerned, the benefits of having a good and enabling environment for businesses to thrive in Nigeria.
“My review of the recent indices on ‘the ease of doing business in Nigeria’ revealed that there has been considerable improvement in the area of taxation and the ease of paying taxes in the country. There is no doubt about the positive impact this has had on our improved tax collection performance over the years.
Mashi explained that the successes recorded by the segmentation of FIRS structure into one stop-offices (Integrated Tax Offices, ITOs and the large tax Office, part informed the service decision to further segregate into taxpayers with turnovers between Two Hundred Million and One Billion Naira (between N200million – N1billion) to the Medium Tax Department from the old Small and Medium Department while others below that threshold are now in the Micro and Small Tax Department.
He noted that other initiatives of the Service, includes FIRS re-emphasis on the Self Assessment Scheme which is now guided by the newly gazetted Tax Administration (Self Assessment) Regulations, 2011; the taxation of pioneer companies which is guided by the Industrial Development (Income Tax Relief) Act, Cap I 7, LFN, 2004; and the taxation of Non-Governmental Organisations (NGOs).
He maintained that though Non Governmental Organisations are not to pay tax. They are obliged by law to register with the tax authorities.
But NGOs cease to enjoy that status once they engage in profit making activities.
One of the taxpayers, Mr. Ofodile Julius said FIRS would rake more revenue into government coffers and reduce “excessive luxury” if the people who acquire “plenty cars, houses and other luxury properties are asked to pay taxes on their properties”.
“I think that the government should look into property tax. That is where you will get these people who live in excessive luxury to pay taxes on their properties. If you go to places like Asokoro, Maitama (in Abuja), Ikoyi, Ikeja, Victoria Island (in Lagos), you will see luxury properties wasting. People park five to ten cars in one compound. Those people should be made to pay taxes on the properties”.
“Those of us that pay taxes are poor people. We do businesses to employ numerous graduates from our universities who are jobless. But we pay taxes from the little resources we make. We should ask ourselves a question, if we all (poor people) pay our taxes, what stops the government from collecting taxes from the rich”.
Another taxpayer, a founder of an International Non-Governmental Organisation also suggested that Nigeria, like other countries, should enact law for property tax.
Responding to taxpayers, the Coordinating Director, Field Operations Group (FOG), Mr. Samuel Ogungbesan said FIRS has recorded series of changes in organizational structuring and in policy implementation in response to stakeholders’ demands and suggestions and congratulated the taxpayers for opening up.
“We need to secure your confidence, and understanding, that is why we are doing all of these we are doing today. Until I am able to go out, meeting taxpayers out there, shaking hands with them and smiling with them, I feel my jobs are not yet done.”
He noted though that it is not correct to create the impression that there is no property tax in Nigeria as tenement rate and other grades of fees being collected by the Lagos state government and the Federal Capital Development Authority, FCDA—when property is sold are proper tax of some sorts. That is when you buy property, you pay two per cent of estimated value of the property. There is also Capital Gains Tax…. “In the1980s, Capita Transfer Tax was introduced. But it never worked. In the 1990s government repealed the law.
“As a taxman, I will like anything that could increase our earnings. But note that what we do in FIRS is tax administration. We don’t make the laws that govern tax administration. That is the business of the legislature. We only implement laws.
I agree that if we have more information from AGIS (Abuja geographical Information Society)…we would have more information to tax. We are working on it. But we are not there yet. Also note that we (FIRS) don’t administer Personal Income Tax in all states of the Federation. We only do for Abuja. Thus we have 37 tax authorities in Nigeria. We do not have control over some of these things.
The Director, Medium Tax Department of FIRS, Mr. Gregory Akeye expressed happiness at the response of the taxpayers: “This programme has been made possible to give you, the taxpaying public, an opportunity to be heard and for tax authority to educate you on some of our recent activities.
“The most recent in our list of initiatives are the Taxpayer Segmentation Programme and Self-Assessment Scheme. While the Taxpayer Segmentation is a part of our re-organisation exercise, which has been on since the past three or four years, the Self-Assessment Scheme is a modification of the existing Self-Assessment regime which began in the early 90s in the country.
Arising from our ongoing reform and pace of growth in the tax system in the country, there is the need to keep the taxpayers informed of new developments and to educate our stakeholders on FIRS expectations going forward.
Currently, we have Large Tax Offices, Medium Tax Offices, and Micro and Small Tax Offices, now formed into directorates for ease of operations and better services delivery to taxpayers, Akeye said.