The Federal Inland Revenue Service (FIRS) hinted yesterday of its plan to generate about N10 billion from airline companies in Nigeria on Value Added Tax (VAT) alone per annum.
FIRS said it could generate the revenue from the airlines through the Integrated Tax Administration System (ITAS) initiative.
The director of ICT, FIRS, Mr. Kola Okunola, who made the remark at a training for tax reporters in Abuja said only three airlines: Aero Contractor, DANA Airline limited and Med View Airline have keyed into the FIRS Aviation VAT collection initiative.
Okunola disclosed that the agency was able to generate N2.5 billion from the three airlines within the period of 2014 to date. “These airlines have the lowest per cent of the market share”, he lamented.
He added that, while other Airline companies including Arik, with about 74 per cent market share in the Nigerian aviation industry are yet to adopt the idea, FIRS was still engaging them in a dialogue to buy into the idea.
ITAS is a new automating tax administration model which allows the FIRS to deduct VAT or consumption tax from taxpayer, including air travelers at the point of payment and remit same direct to its VAT account domiciled in the Central Bank of Nigeria (CBN).
He explained that the project was aimed at improving ease of doing business with FIRS, enhancing voluntary compliance and boosting revenue generation. “The ITAS solution has been customised to reflect Nigeria tax legislations, bringing standardisation and efficiency to tax administration”, he remarked.
Okunola also reiterated that taxpayers across board can now explore the newly created FIRS payment portal to file in their tax returns, get tax clearance certificates and receipts and make other payments without having to go to the service’s office.
Meanwhile, the minister of industry, trade and investment, Dr. Okechukwu Enelamah, has disclosed that a key trade facilitation agreement (TFA) signed by Nigeria and more than 100 other nations with the World Trade Organisation is expected to provide the country’s manufacturing industry with a major boost.
Speaking to a global research and consultancy firm, Oxford Business Group (OBG), Enelamah said the milestone TFA should ease the overall cost of doing business in Nigeria, which he acknowledged was one of the three main obstacles that manufacturers currently face.
“The biggest challenge is definitely infrastructure in one form or another. In addition, manufacturers need more access to sustainable, affordable and reliable power. That is our first priority as a government and as a ministry. Each of these areas represents an opportunity to take the country higher and to fulfil our potential” he stated.
Enelamah told OBG that creating an attractive environment for manufacturers through measures such as tax breaks, export incentives and finance was high on the government’s agenda in line with its broader aim of increasing local production.
He said, “Producers need assurance that if they produce locally, their products will enter the local value chain, and we have created the conditions for that,” he told OBG. “We are also working to avoid dumping, as entrepreneurs that are producing high-quality products cannot compete with imports that are cheaper and of lower quality.
“Nigeria’s plans for boosting foreign direct investment levels are also outlined in the interview. We want to improve the supply of foreign currency through funding programmes that will bring billions of dollars into the economy. We are also reorganising and revamping the Nigerian Investment Promotion Commission. Ultimately, we are aiming to create the confidence that investors need to come to Nigeria”.