- As FG rules out VAT increase, others
The Nigeria Customs Service (NCS) has been told that the revenue target of N1tn for the 2016 it has set for itself will not be met because of the prevailing economic policies that have stifled importation.
Publicity Secretary of the Association of Nigerian Licensed Customs Agents (ANLCA), Dr Kayode Farinto said the federal government economic policies have put many Nigerian importers out of business, a development, which will also affect revenue generation from the sector.
Farinto pointed out the foreign exchange restriction as the major headache of the importers, adding that many of them were currently waiting to know the direction of government before deciding on the next move.
He said that importers have folded their hands now as far as importation is concerned because they do not understand the direction of the present government.
According to him, about 70 percent of importers were not importing because of the hard economic conditions imposed by government.
He accused the federal government of not giving a sense of direction, adding that the only thing known to many is that government is fighting corruption.
The comptroller-General of the Service, Hameed Ali, had about two days ago said that the Service has set a revenue target of N1tn for itself this year.
He said that on receiving a revenue target from the Budget Office, the Service also had to set its own target as has been traditional.
“We have not received the 2016 revenue target from the budget office yet but we normally set a target for ourselves and we are looking at one trillion naira for 2016.
“We hope and are working to block all leakages and making sure that our system works perfectly and hopefully the polices of government will also be in our favour. We hope to hit N1 trillion in 2016”
He disclosed that introduction e-customs has helped in revenue generation, and expressed optimism that the target would be met.
“Collection of revenue and interception of harmful imports have been made easier with the help of technology.
“In line with the change mantra of the present government, let me remind all operatives and stakeholders alike not to abuse the process and corrupt the system.
“Any act calculated to distort and compromise the integrity of e-customs will not be tolerated and will be met with appropriate sanctions,”
Ali also said that officers and men of the Service have been complying with the order on declaration of assets.
In the meantime, the Federal Government, on Thursday, assured Nigerians that it would not increase taxes despite the dwindling crude oil revenue.
The Minister of Budget and National Planning, Senator Udo Udoma, disclosed this to State House correspondents at the Presidential Villa, Abuja at the end of a meeting of the National Economic Council (NEC) presided over by Vice President Yemi Osinbajo.
Udoma was joined at the press briefing by the Lagos, Anambra and Jigawa state governors, Mr. Akinwunmi Ambode, Mr. Willie Obiano, and Alhaji Badaru Abdullahi, respectively. The minister said there was no plan to increase either the Value Added Tax or the Corporate Tax.
He, however, said it was the government’s desire to see an increase in the tax collection rate, which currently stands at about 20 per cent.
The minister said, “We do not intend to increase the VAT rate at the moment, but we want to increase the collection rate from 20 per cent. We will also not raise the Corporate Tax, because we do not want to impose additional burden on Nigerians.
“Government’s position is, however, that those who make money and have not been paying taxes should pay. We expect at least 20 per cent increase in the tax collection rate, which is conservative in terms of our revenue projection.”
He added that the government would work closely with the National Assembly to explore other innovative financing methods for the 2016 budget.
For instance, the minister said the Federal Government would consider private sector funding for some capital projects. Udoma also cited tolls collection as one of the options being considered for road construction and maintenance.
He added, “With reference to the budget, one thing we are determined not to do is to cut any of those capital projects because we need them to stimulate the economy. We are going to work with the National Assembly to see how we can get savings. One of the areas we are looking at is our cash call elements.
“The Minister of State for Petroleum is looking at how we can cut our cash call elements, which is about N1tn, by innovative financing. So, he is discussing with some oil companies and looking for some innovative financing, which might pick up some of the financing so that we reduce our financial output and contributions by the Federal Government; that will be a major saving, which can be used to plug the gap, particularly with falling oil prices.”
The minister added, “In addition, some of the capital projects the various ministries for infrastructure are looking at how we can get private sector funding for some of them. For instance, the airports can be concessioned, we are looking at public buy-back for some of the roads, looking at tolls. We have to be imaginative.
“But it is important not to touch the capital portion because that is important to revitalise the economy and to get our people back to work, to get growth moving again so that we can get the four per cent growth.”
Obiano said the NEC also received the report of a committee that investigated government agencies collecting revenues in foreign currencies and remitting into the Federation Account in naira. He listed some of the agencies to include the Nigerian National Petroleum Corporation, Nigerian Maritime Administration and Safety Agency, Nigerian Ports Authority and the Federal Inland Revenue Service, among others.
The governor, however, said the council was assured that the introduction of the Treasury Single Account had resolved the problem as all government accounts were now under the Central Bank of Nigeria.
He said, “On the report of some government agencies collecting revenue in foreign currencies but remitting to the Federation Account the naira equivalent, the Permanent Secretary, Ministry of Finance reported that apart from the NNPC, NIMASA and Nigerian Ports Authority, other agencies involved in revenue generation are the FIRS, Nigerian Shippers’ Council, Federal Airports Authority of Nigeria and the Nigerian Immigration Service.
