• Sunday, July 14, 2024
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FG to deploy PPP solution to boost excise, tax revenue

FG to deploy PPP solution to boost excise, tax revenue

To mitigate dwindling revenue and push more non-oil revenue streams, the Federal Government is set to deploy an Integrated Secure Track and Trace Solution to boost revenue earnings through excise and tax collection.

This was made known on Wednesday when Michael Ohiani, the director-general of the Infrastructure Concession Regulatory Commission (ICRC) presented the Outline Business Case (OBC) compliance certificate to Zainab Ahmed, minister of finance, budget and national planning, affirming that the project was viable.

The PPP solution will adopt the Build, Operate and Transfer option. It will allow the Federal Government through the ministry of finance to establish an effective and non-intrusive control on a broad range of goods and services, subject to excise duty, safety and standards.

While receiving the OBC certificate, Ahmed said the proposed solution was important at this time as the government is constrained in terms of revenue.

“The purpose of this project is to enable the ministry have visibility over a number of key products that are made in Nigeria, in terms of the quantity and companies that produce them.

“It is also to differentiate between products produced in Nigeria and the ones that are imported; the bottom line is for us to be able to maximise our revenue potential.

“Having had several meetings with the proposing company, we thought that the best way to do this is through a Public Private Partnership (PPP) model and I am glad that the Outline Business Case (OBC) compliance certificate has been issued,” she said.

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She added that as the fiscal authority of the government, the ministry of finance had the responsibility to ensure that duties and taxes are paid and that the relevant agencies are assisted to make their work more seamless, hence the need to deploy the solution.

She assured that the solution will not put more burden on companies as the duties to be collected will not disrupt manufacturing in any way.

“I am assuring that manufacturing companies’ businesses will not be disrupted. They are not going to incur any additional cost; the excise duty that will be charged will be a pass through cost. We are convinced that this is the right thing to do,” Ahmed added.

She expressed confidence in the solution, citing that the same infrastructure had been deployed by the same company in South Africa and Morocco to boost their revenue accruals.

Ohiani, presenting the OBC, said the solution will bring about many benefits to Nigeria, including stemming illicit trade and revenue leakages, improving revenue generation for the government, ensuring circulation of high-quality goods and services, among others.

“The proposed solution when implemented will allow the Federal Government to establish effective and non-intrusive controls on a broad range of markets, such as goods and services subject to excise duty, and goods subject to conformity with health, safety and quality standards.

“Additionally, the solution aims to reduce the levels of counterfeiting, sub-standard quality, tax evasion and under-declaration in these markets,” Ohiani said.

Ohiani said the ICRC and the ministry will proceed to the procurement stage after which a Full Business Case (FBC) compliance certificate will be issued for onward submission to the federal executive council for project approval.