• Monday, December 04, 2023
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FIRS aims to raise revenue with tech to capture informal sector

FIRS leverage technology to capture informal sector in tax net

The Federal Inland Revenue Service (FIRS) is set to partner with the Market Traders Association of Nigeria (MATAN) to collect & remit value added tax (VAT) in the informal sector using a unified systems technology.

The collaboration under the VAT Direct Initiative (VDI) will promote VAT collection and remittance the awareness in the market place and informal sector. It will also help to simplify VAT payment and remittance for the informal sector.

According to a statement issued by the agency, through this partnership with MATAN, the FIRS will access Nigeria’s market space with a membership of over 40 million traders across the country.

“MATAN has a digital platform which enumerates their members giving them a digital ID and tracks their turnover so that VAT accrued is collected and remitted to the FIRS

“Through this initiative the FIRS will help tackle multiple taxation in the market place through partnership with security agencies to curb the activities of touts, miscreants and self-imposed tax collectors involved in illegal tax collection in Nigeria’s market spaces,” it stated.

Read also: CPPE seek tax incentives for low-income employees, small businesses

The VDI is expected to boost VAT revenue generation for the three tiers of government, which in turn provide more funds for government to invest in infrastructure, social amenities and welfare of citizens.

According to a  statement, the partnership will provide a monitoring and evaluation team comprising of FIRS officers and MATAN members to ensure transparency, accountability, prompt VAT remittance, and sustained commitment which are vital to build the public confidence.

It stated that each MATAN members will receive an Identity Card upon enumeration which contains their Tax Identification Number (TIN) and other personal details for tax purposes.

Over the years, Nigeria’s tax net covered majorly the formal sector despite the numerous activities in the informal sector as tax experts pointed out the untapped potential in taxing the informal sector.