Despite Having More Taxpayers Than South-Africa, Nigeria Earns Less From Taxes– FIRS Boss

The Chairman of the Federal Inland Revenue Service, Muhammad Nami, has said that Nigeria’s tax payers are only 41 million out of the over 200 million population.

Nami made the disclosure at the ‘Public Presentation and Breakdown of the Highlights of the 2022 Appropriation Bill.’

The revelation is coming after President Muhammadu Buhari on Thursday presented the 2022 budget proposal of N16.39trn before a joint session of the National Assembly.

The budget which is titled, ‘Budget of Economic Growth and Sustainability’ will be the last budget that will be fully implemented by the administration of Buhari.

The FIRS Boss said this in light of the current revenue crunch of the country.

He lamented that despite having 41 million tax payers in the country than that of South Africa’s 4 million tax payers Nigeria earned far lower than what South Africa generates from Personal Income Tax.

Specifically, the FIRS Boss said that Nigeria earned Personal Income Tax of N1trn from 40 million taxpayer as against the N13trn generated by South Africa from just 4 million taxpayers.

The FIRS Chairman said, “Our total taxpayers today is in the region of about 41 million people and the total personal income tax paid last year was less than N1trn by 40 million people.

“If you also compare that with our own brother South Africa where they have a total population of about 60 million people, with just 4 million taxpayers, the total personal income tax paid in South Africa last year is about N13trn. You can now see that these things are not adding up.

“The number of billionaires in Lagos alone are more than the number of billionaires in the whole of South Africa but yet what we generated as Personal Income Tax by Lagos State Government is just just less than N400bn.

“So if we don’t pay these taxes, there is no way the government will be able to provide the social amenities required , the critical infrastructure required for the wellbeing of the country.”

Nami revealed that as of September, only N4.2trn has been generated from taxes.

He revealed, “To address the issue of Nigeria not diversifying its economy, from a tax perspective, you will discover that we are actually diversifying the economy.

“The total collection we have up to 31 September which we have not fully reconciled with the CBN and the Nigerian Customs is about N4.2trn, and from this amount, oil related taxes accounted for only 22 per cent which is N950bn only, the non oil taxes we have generated within that period is N3.3trn.

“Secondly, to discuss about the taxes that are being paid in the country and to say whether they are adequate or not, I want to believe one, they are not adequate.

“People are not willing to pay even when people are appointed as agent of collection, whatever they have collected one half of government they find it difficult to remit.

“When you compare Nigeria as an oil producing country to a small country of Saudi Arabia that the Honourable Minister (of Finance)has pointed out, we are still not there.

“We assume that we are a rich country, I don’t think that is correct. We only have the potential to be rich, because one we have a very huge population of about 200 million. We have an issue to discuss and to talk about how to solve our own problems.

“If you look at it from the rate of taxes paid, In Saudi Arabia with a population of ten million people, the VAT rate is as high as 15 per cent and what we have in Nigeria is just 7.5 per cent.”