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The Nigeria Governors Forum (NGF) has harped on the need for states to embrace digitalised tax collection to raise their Internally Generated Revenue (IGR).
The Chairman of NGF and Governor of Ekiti State, Kayode Fayemi, made the call at the opening of the 6th IGR National Peer Learning Event organised by the forum on Monday in Abuja.
Fayemi, in his opening address, said the meeting would discuss the objective of deepening the drive for improved domestic revenues at the state-level through effective, efficient, fair and legal tax administration.
The governor said the COVID-19 pandemic, decline oil prices and the social unrest, which echoed the demands of the ENDSARS protests, had further worsened the country’s economic and social conditions.
“This exacerbated the already vulnerable fiscal environment for governments at both the national and sub-national level. Other accompanying trends have included rising inflation rate, degrading exchange rate and growing unemployment,” he said.
Fayemi noted that the need to improve government revenues to adequately service planned expenditures could not be overemphasized.
He expressed regret that the 2020 half-year year-on-year IGR performance reported a negative growth of 11.7 percent for the 36 states and the FCT.
He, however, noted that Ebonyi, Gombe and Yobe states recorded more than 50% in growth despite the overall decline.
He said, “At the state level, we are professionalizing our Internal Revenue Services to be taxpayer-centric and responsive to the new normal of digitalizing tax administration. The world’s trade and financial market are going digital and we must adapt or be left behind.
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“We are not canvassing or proposing for new taxes to be introduced but emphasizing the need for our Internal Revenue Services to be more strategic, innovative and pragmatic in administering those taxes, fees, levies and charges that have been legally prescribed for collection across various jurisdictions.
“Pivotal to the success of these series of reforms is taxpayer enumeration which is still very much weak.
“While technology presents us with a platform to strengthen our taxpayer databases, we must collaborate, share data, intelligence and information, and embrace advanced taxpayer profiling techniques to inform our approach to taxpayer management.
The Minister of Finance, Budget and National Planning, Zainab Ahmed, said the impact of COVID-19 on the economic and fiscal revenue outlook for 2021 presented a significant opportunity for states to strategise and reposition their fiscal revenue management
According to her, fiscal reforms are important now, more than ever, to mitigate against current and future risks, bearing any future pandemics or other global crises.
She stated that,l the revenue outlook for 2021 depends on the willingness of state governments to embrace the right tools, technology and strategies to transform, enhance and strengthen revenue growth and sustainability, and adopt cost optimization plans.
Ahmed added, “In the area of tax administration, the government is leveraging on technology and digitalization to drive revenue mobilization, data management and cost optimisation.
‘Technology is also being used for the purpose of assessing and collecting stamp duties; as well as for the automation of VAT collections in the retail, banking and telecommunications sectors – with more sectors being explored for onboarding.”
The Director General of NGF, Asishana Okauru, said the meeting was called for states to share their experiences about what measures proved most effective during the period of COVID-19/lockdown and after, as well as plans for 2021 to stabilise public finance and incentivise business recovery for jobs, growth and stability.
“We believe that tax data recorded digitally can provide an accurate representation of the cost of the pandemic on the society; It can also provide direction on counter measures required to steer the economy into recovery,” he said.
