THE Federal Inland Revenue Service has decried a systemic abuse of the pioneer incentive scheme instituted by the Federal Government, which has led to tax revenue leakages for the three tiers of government.
In this regard, it said it was auditing its findings to press for the cancellation of pioneer certificates issued to undeserving companies in violation of the law.
The Service stated this during a courtesy visit to the Executive Chairman, Muhammad Nami, by State Commissioners of Finance, at the Revenue House, headquarters of the FIRS in Abuja.
Consequently, the FIRS vowed to plug this tax revenue leakage in order to generate more revenue for the three tiers of government.
Coordinating Director, Tax Operations Group, FIRS, Femi Oluwaniyi, who expressed appreciation to the state commissioners of finance for their support, so far, in revenue generation for the Federation, decried the indiscriminate tax waivers and incentives granted to undeserving companies, which he stressed had impacted negatively on revenue generation.
Oluwaniyi disclosed that the FIRS had discovered that pioneer status certificates had been issued to companies that were not pioneers of their fields in the real sense, hence undeserving of such status.
He added that this development had led to a loss of considerable tax revenue to the three tiers of government.
The FIRS stated that pioneer status otherwise granted outside the law would not enjoy tax relief, regardless of the certificate issued, adding that owners of such certificates were requested to regularise their tax positions or face sanctions in accordance with the law.
Earlier, Nami stated that tax revenue accounts for nearly 70 per cent of what was shared at the last FAAC meeting and lauded the collaboration between the Service and the State Commissioners of Finance, saying this was key to bringing about increase in tax revenue.
He said without this collaboration, it would be difficult for government to meet its obligations to the citizenry in such areas as infrastructure development and salary payment, which could lead to social dislocation.
The Executive Chairman emphasised the need to diversify the economy in order to create more sources of taxable income and increase tax revenue for the nation.
He charged the states to focus on other forms of taxes like the Stamp Duty, which he described as “the black gold” which had been ignored before now.
He also charged all Ministries, Departments and Agencies to scrupulously deduct Withholding Tax from contracts at the point of payment.
Nami also solicited the states’ support in terms of taxpayer sensitisation campaigns and education, stating that rental obligation was incomplete without the payment of Stamp Duties.
He emphasised that if these initiatives were pursued at both local and state levels, more revenue would be generated.
Team lead of the delegation/Benue State Commissioner of Finance, David Olofu, congratulated Nami on his well-deserved appointment and on his accomplishments in office.
