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Federal Government through the Ministry of Finance will by the end this month come up with a regulation that shows additional list of items exempt from Value Added Tax (VAT).
This comes as the national taxpayer data have grown to about 17 million as of December 2017.
Babatunde Fowler, executive chairman, Federal Inland Revenue Service (IFRS), disclosed this at the weekend while responding to questions of chief finance officers at the 2018 KPMG CFO forum and CFO outlook survey report presentation in Lagos.
“VAT process has been very simple. If we give you items to exempt that means everything else is VATable. We also looked deeper, there are certain items that should be VAT exempt and the minister of finance is quite aware and we should be getting out our regulation before the end of this month that will show you additional items that will be exempt from VAT,” Fowler said.
One of the questioned raised was on extension of the Voluntary Asset and Income Declaration Scheme (VAIDS), which Fowler responded to by saying that the issue of the extension would be decided by the President.
“This programme was approved by the Federal Executive Council, Senate and House of Representatives. It is beyond me as chairman or minister of finance to extend. Put in application, because the application will show that you have started the process,” he said.
The scheme is expected to help expand Nigeria’s tax base and improve the low tax to Gross Domestic Product (GDP) ratio from the current 6 percent to between 12 percent and 15 percent in the first instance.
Responding to issue on tax laws, the executive chairman of FIRS said, “We are in the process of changing the tax laws. In the 2018 budget, we have presented amendment to tax laws.” The tax amnesty will end by the end of this month.
Ayodele Subair, executive chairman, Lagos Internal Revenue Service (ILRS), responded to issues raised on capturing the informal sector in tax administration.
According to Subair, Lagos accounts for 24 million residents but only 5 million registered as taxpayers. He was worried that it was a difficult task to broaden the tax net to capture the informal sector because the people in this sector were very mobile and could change address at any time.
Subair, however, said the state was collaborating with consultants to increase level of awareness and registration, but was concerned that the challenge was lack of credible data. “Credible census will help to do sectoral analysis.
“The LIRS will continue to create avenues in ensuring that residents are able to access information necessary to make tax payment seamless.”
Other speakers at the forum include Kunle Elebute, senior partner, KPMG in Nigeria and chairman, KPMG Africa, who welcomed the participants; Yimika Adeboye, finance/strategy director, Cadbury Nigeria plc, and Wole Obayomi, partner/head, Tax, Regulatory and People Services, KPMG in Nigeria.
KPMG at the forum launched the CFO outlook survey, which indicated a 10 percent increase in overall confidence sentiments among CFOs on the prospects for growth in the Nigerian economy.
