The Federal Internal Revenue Service (FIRS) has said the nation saw a steady increase in tax collections from the non-oil sectors of the economy in 2021, peaking at 69% from 38% in 2017.
In its 2021 performance update, FIRS said it collected a sum of N4.396 billion as non-oil taxes compared to N2.507 billion collected in 2017.
“This feat was made possible through the adoption of the in-house built TaxPro Max Solution and other strategic reforms implemented by the Service,” FIRS President Muhammad Nami said in the update.
He noted that the year 2021 was critical for the tax administration in Nigeria and in accordance with the law, the 2021 corporate income tax revenue was based on the 2020 business profits.
The head of FIRS noted: “In the year 2020, the country entered an economic recession for the second time in 5 years. The recession was caused by a 5-month lockdown caused by the coronavirus pandemic. Compounding the economic challenges of Covid-19, business activities were disrupted by the End-SARS protests.
“Due to the recession, many companies struggled to survive with very little profit reported. The corporate tax base was severely eroded due to business losses and bankruptcies.
“With the current Management taking office, FIRS initiated strategic administrative and operational reforms, including the implementation of new policies that would improve its ability to fulfill its mandate.”
He explained that the implementation of the new automated tax administration system (the “TaxPro Max”) in June 2021 was a game changer.
“With the solution, taxpayers experienced the ease of registration, declaration, payment and issuance of Tax Settlement Certificates, while the Service experienced greater efficiency in the deployment of resources, which led to better revenue collection”, He said.
FIRS said that the year was certainly very challenging, but it opened up a new perspective of opportunities that led to very encouraging results.