FIRS targets digital economy, seeks to achieve full tax automation in 2022

The Federal Inland Revenue Service (FIRS) says it hopes to achieve 100% automation of all its tax administration processes by 2022.

This, the agency added, would help it block revenue leakages and ultimately revolutionise revenue generation in Nigeria.

Executive Chairman of the FIRS, Muhammad Nami, speaking as the Special Guest at the Pedabo 2022 Annual Public Private Sector Engagement on Tuesday, said that by virtue of the amendment of the FIRS (Establishment) Act in the 2021 Finance Act, any person who fails to grant the revenue agency access to its information technology systems is liable to penalties.

“We will seek to achieve 100% automation of all our tax administration processes, which will block revenue leakages and revolutionise revenue generation in the country. We expect your full cooperation in this regard, considering that by the amendment to Section 25 of the Federal Inland Revenue Service (Establishment) Act in the 2021 Finance Act (through Section 18 of the 2021 Finance Act), any person who fails to grant the Service access to its information technology systems to connect to its automated tax administration solution is liable to penalties under the law,” Nami said.

According to a statement issued Thursday by Johannes Oluwatobi Wojuola, Special Assistant on Media and Communication to the chairman, FIRS had leveraged on the 2021 amended act to embark on “a major infrastructure overhaul, focusing on the deployment of technology for the automation of its processes and procedures”.

This move saw the agency deploying its home-grown integrated tax administration system, TaxPro Max.

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Nami further stated that in 2022, the FIRS will give priority to the collection of taxes from the digital economy, and that it will deploy technological tools in assessing entities that fall within the Significant Economic Presence (SEP) threshold and relevant turnover generated from Nigeria.

“With the amendment of Section 10 of the VAT Act by the Finance Act 2021, we will implement the published Guidelines on the Simplified Compliance Regime on VAT for Non-Resident Suppliers, to collect VAT on digital supply of services and intangibles to Nigeria.

“The Service has deployed a digital service interface, the Digital Economic Compliance (DEC) Tool, to facilitate the implementation of the Regime. The implementation of the DEC Tools will also assist the Service in determining entities that fall within the SEP threshold and relevant turnover generated from Nigeria. This tool will go live shortly,” he said.

Nami said the revenue agency “will focus on compliance and enforcement strategies in 2022, by leveraging on intelligence, strategic data mining and analysis, to enhance audit and investigation functions and implementing the penalty regimes in accordance with the laws;” adding that, “the Service is poised to ensure prosecution of recalcitrant taxpayers in 2022.”

He called on taxpayers, tax consultants, tax collection agents and other stakeholders in the tax system to partner with the FIRS in 2022, to make taxation and tax revenue collection a pivot for economic growth and national development, stating that “no society can grow without its citizens paying their taxes.”