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FIRS Eyes N5 Trillion VAT Revenue in 2024

The Federal Inland Revenue Service (FIRS) has unveiled ambitious plans to target a Value Added Tax (VAT) revenue of N5 trillion in 2024, while also implementing strategies to address identified tax gaps.

This announcement was made by FIRS Chairman, Zacch Adedeji, during a press conference organized by the Support Programme for Tax Transactions in West Africa, supported by the European Union and ECOWAS, in Abuja.

Adedeji, represented by FIRS official Mr. Matthew Osanekwe, highlighted the increasing trajectory of VAT revenue in recent years, citing figures of N1.9 trillion, N1.5 trillion, N2.5 trillion, N2.3 trillion, and N3.6 trillion for the years 2019 through 2023 respectively.

He emphasized the government’s commitment to aligning with ECOWAS directives on tax reforms, specifically referencing Article 30, which allows member states to set VAT rates within a range of 5% to 20%.

Furthermore, the FIRS disclosed that the Federal Government anticipates total revenue of N19.41 trillion from the agency in 2024, reflecting a significant increase compared to previous years.

Osanekwe emphasized discussions at the National Assembly regarding VAT reform legislation, which aims to raise VAT revenue to approximately N5 trillion from the current N3.6 trillion.

Efforts to expand the scope of VAT collection include measures such as collecting taxes from non-resident resource suppliers like Google and Amazon, as well as utilizing collection agents such as Deposit Money Banks and telecommunication companies.

Additionally, the FIRS is collaborating with the United Nations Development Programme to train workers on VAT gap analysis, with the goal of enhancing revenue collection efficiency.

Osanekwe underscored ongoing initiatives to transition from the Net Profit method to the Full Consumption method of tax collection, in line with Article 10.

He emphasized that with the implementation of these measures, the FIRS is poised to achieve a VAT revenue target of N5 trillion in 2024.

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