As the deadline for the Voluntary Asset and Income Declaration Scheme (VAIDS) approaches, the National Association of Small and Medium Enterprises (NASME) has carried out a sensitisation programme for operators of small businesses to enable them properly understand the requirements and benefits of being tax compliant.
The sensitisation programme and the tax compliance clinic sponsored by OXFAM is aimed at assisting MSMEs become tax complaint before VAIDS’ June 30th deadline.
“The sensitisation is to enable MSMEs that have not been able to comply with their tax filings to be tax compliant before the deadline of the Voluntary Asset and Income Declaration Scheme (VAIDS),” Eke Ubiji, executive secretary, National Association of Small and Medium Enterprises (NASME), said.
“This program has two focal states: EDO and Lagos, and we are expected to get 90 MSMEs for each of the states to be tax compliant and this is the reason we are having this sensitisation for them,” Ubiji said.
A clinic was also organised as part of the programme to help operators regulate their documentations for proper tax fillings.
Degun Agboade, president of NASME, who was represented by Ladi Bankole, member of the governing council representing the private sector, while acknowledging the support of members of the coalition, noted that there was a huge illiteracy gap on tax issues among MSMEs operators.
“We need to increase the level of tax education for MSMEs. This will increase their participation in tax payment and compliance,” Bankole said.
Igho Orienru, assistant director, Lagos State Internal Revenue Service (LIRS), who represented Ayo Subair, chairman of LIRS, urged MSMEs to comply timely by filing and reporting all required tax information to the appropriates authorities to ensure the development and growth of the economy.
Orienru called on all operators of small businesses that had not been tax compliant to take advantage of the VAIDS window the Federal Government created to regularise their tax payments.
“Nigeria tax revenue is inconsistent with the lifestyle and spending levels of Nigerians. Most of the profitable businesses in Nigeria have abysmal tax payment records,” he said.
“We have 80.7 million registered businesses in Nigeria and only 3.4 million individuals pay taxes. Nigeria’s six per cent tax to GDP ratio is among the lowest in the world. Ghana has 16 per cent tax to GDP ratio; South Africa is 27 per cent and the average of OECD countries is 24 per cent,” he added.
He highlighted the benefits of MSMEs’ tax compliance, saying that it would make government at all levels provide more social projects that would continue to aid growth and development in Nigeria.
“The VAIDS was implemented to ensure an increase in tax compliance as only one in every five tax payers is tax compliant,” Orienru further said.
While highlighting the challenges limiting their compliant rates, stakeholders identified multiple taxation.
Nnenna Ugwu, project coordinator, Enterprise Development Centre (EDC), Pan-Atlantic University, Lagos, who was also a representative of OXFAM, said that to increase the rate of tax compliance among MSMEs, governments at all levels must address issues of multiple taxation, stating it had been a major problem for operators.
“Multiple taxation is a big problem for businesses and government must address it if truly it wants to increase its tax compliance rates,” Ugwu said.
The operators also called for a seamless procedure in the filing of taxes with authorities and synergy between all tax administrators, instead of having to deal with them individually.
