Tinubu moves to strip Customs, NPA, others of revenue collection role

President Bola Tinubu is considering a policy to strip multiple revenue-generating agencies, including the Nigerian Customs Service and Nigerian Ports Authority, of their authority to collect government revenue. Instead, a new centralized body, the Nigeria Revenue Service, may be created to handle all federal revenue collection.

According to a report by PUNCH, the initiative comes as part of broader tax reforms aimed at improving the government’s revenue collection efficiency.

The proposed changes would remove the revenue collection duties from over 60 agencies and shift these responsibilities to the new Nigeria Revenue Service.

The reforms, outlined in four executive bills submitted to the National Assembly, are intended to improve tax collection and maximize government income to support public services and infrastructure development. These bills were read during plenary sessions by Senate President Godswill Akpabio and Speaker of the House of Representatives Tajudeen Abbas.

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One major aspect of the reform is the renaming of the Federal Inland Revenue Service (FIRS) to Nigeria Revenue Service, which would take on the primary role of assessing, collecting, and accounting for government revenues.

A source at the Presidency clarified that this change would not lead to a merger of agencies but would simply transfer revenue collection tasks to the new agency.

There is no merger of agencies. The bill will only take the revenue collection arm of each agency involved and take it to the Nigerian Revenue Service.

“The plan is that the new revenue agency will be like the US or UK revenue agency that collects all government revenues while other revenue agencies like NIMASA, NPA, Customs, etc, will now focus on their core mandate, which is trade facilitation. There is no merger at all,” the official said.

The bill seeking the name change for FIRS was outlined in a letter read by Senate President, Godswill Akpabio, and the Speaker, House of Representatives, Tajudeen Abbas, during the plenary sessions.

The proposed law, titled the Nigeria Revenue Service (Establishment) Bill, seeks to repeal the Federal Inland Revenue Service (Establishment) Act, No. 13, 2007, and establish the Nigeria Revenue Service.

According to Tinubu, the new agency will be responsible for assessing, collecting, and accounting for revenue accruing to the government.

In addition to the name change, Tinubu submitted three other tax reform bills under the title, ‘Transmission of Fiscal Policy and Tax Reform Bills’ to the National Assembly.

The President also transmitted to the parliament the Joint Revenue Board Establishment Bill, which seeks to create a Tax Tribunal and a Tax Ombudsman.

He wrote, “The Nigeria Tax Bill: This bill seeks to provide a consolidated fiscal framework for taxation in the country.

“The Nigeria Tax Administration Bill: Aimed at offering a clear and concise legal framework, this bill will ensure the fair, consistent, and efficient administration of tax laws, facilitating ease of tax compliance, reducing disputes, and optimizing revenue collection.

“The Joint Revenue Board (Establishment) Bill: This proposal seeks to establish the Joint Revenue Board, the Tax Appeal Tribunal, and the Office of the Tax Ombudsman, which will work to harmonise, coordinate, and resolve disputes arising from revenue administration in Nigeria.”

Tinubu emphasised that the proposed tax bills would have far-reaching benefits for the country, promoting taxpayer compliance, strengthening fiscal institutions, and fostering a more effective and transparent fiscal regime.

“I am confident that the bills, when passed, will encourage investment, boost consumer spending, and stimulate Nigeria’s economic growth,” Tinubu stated.

On the floor of the House of Representatives, Speaker, Abbas, confirmed receipt of the bills, stressing that they were designed in line with the objectives of the present administration.

He noted that when passed into law, the bills would encourage the growth and sustainability of the economy.

The House also consolidated six bills seeking the repeal of the Fiscal Responsibility Act, 2007 to enact the Fiscal Responsibility Bill, 2024.

The bill aims at ensuring prudent management of the nation’s resources, ensuring long-term macro-economic stability of the national economy; and securing greater accountability and transparency in fiscal operations within the medium-term fiscal policy framework.

Abbas, who presided over plenary, urged the Committee on Rules and Business to fix a date for debate on the general principles of the newly consolidated bills.

Recall that the tax reforms are policy recommendations from Taiwo Oyedele’s Presidential Fiscal Policy and Tax Reforms Committee, which seeks to reduce taxes in the country from the current 62 to a maximum of nine.

It also aligns with the recommendations of the President Tinubu Policy Advisory Council, which proposed declaring a state of emergency on revenue generation in the country.

Speaking in an earlier interview, Oyedele noted that fiscal reforms were needed to protect small businesses, the vulnerable and the poor while effectively taxing the rich.

He said, “Revenue transformation for us means we can no longer continue to celebrate incremental progress because the base was just so small and for us, it wasn’t about raising the taxes from existing taxpayers.

“In fact, one of the things we found out is that poor persons are those paying taxes, so it is time for them to take a break which means we have to look at the system to take that burden away from the vulnerable people, small businesses and let the middle class and the rich who can afford to pay do so.

“We have a brand new national fiscal policy that sets the framework for where we want to be, where we want to go, what we want to do, and what we want to stop doing as a country. We have identified company income tax, personal income tax, value-added tax, stamp duty, capital gains, and excise tax and we have redrafted new ones.”

This new law will expunge the revenue collection function from 62 revenue-generating agencies and transfer the responsibility of revenue collection to a single agency to promote collection efficiency.

Some of the agencies include Federal Airports Authority of Nigeria, Nigerian Ports Authority, Federal Inland Revenue Service, Nigeria Deposit Insurance Corporation, Nigerian Meteorological Agency, National Agency for Food and Drug Administration and Control, Federal Road Safety Corps, Nigeria Customs Service, Standards Organisation of Nigeria and the Nigerian Airspace Management Agency.

Others are the Bank of Agriculture, Nigerian Bulk Electricity Trading, Tertiary Education Trust Fund, Federal Radio Corporation of Nigeria, Nigerian Railway Corporation, Federal Reporting Council of Nigeria, Nigerian Maritime Administration and Safety Agency, Corporate Affairs Commission, Nigeria Civil Aviation Authority, National Broadcasting Commission and Joint Admission Matriculation Board.

(PUNCH)