The Nigeria Governors’ Forum (NGF) and minister of finance, budget and national planning have said that the deployment of technology in tax collection would ultimately lead to improved internally generated revenue (IGR) for states.
Chairman of the NGF and governor of Ekiti State, Kayode Fayemi, speaking at the opening of the 6th ‘IGR national peer learning’ meeting organised by the NGF, Monday, in Abuja, said the objective of the meeting was to deepen the drive for improved internal revenue at the state level through effective, efficient, fair and legal tax administration.
Fayemi observed that Covid-19, oil prices decline and 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.
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He noted that the need to improve the government’s revenue to adequately service planned expenditures could not be overemphasised.
The NGF chair regretted that the 2020 half-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 percent in growth despite the overall decline.
He said: “At the state level, we are professionalising our internal revenue services to be taxpayer-centric and responsive to the new normal of digitalising tax administration. The world’s trade and financial market are going digital and we must adapt or be left behind.
“We are not canvassing or proposing for new taxes to be introduced but emphasising 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 the current or future global crises.
She observed that revenue outlook for 2021 would largely depend 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 optimisation plans.
“In the area of tax administration, the government is leveraging on technology and digitalisation to drive revenue mobilisation, data management and cost optimisation.
“Technology is also being used for the purpose of assessing and collecting stamp duties and for the automation of VAT collections in the retail, banking and telecommunications sectors – with more sectors being explored for onboarding.”
