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Nigeria's FIRS reports N5.5 trillion tax revenue amid economic headwinds

 

By Nerly Shammah Jul 28, 2023

 

The first half of the year saw a tax round exceeding expectations by over 100%, spurring excitement moving forward despite the looming crisis in Nigeria. 

 

 

In what looks to be the largest ever tax collection revenue for the first six months of a fiscal year, according to statements from the Special Assistant to the Executive Chairman on Media and Communications, FIRS, Johannes Oluwatobi Wojuola, reportedly acknowledges the impressive tax turnover in the Nation even in the wake of a major financial crisis. 

 

Nigeria's Federal Inland Revenue Service (FIRS) reported a tax collection revenue of N5.5 trillion for the first six months of 2023, from January to June. 

 

The report goes on to note that over 68% of the tax revenue came from the non-oil sector, exceeding FIRS's expectations. 

 

From January to June 2023, the reported tax revenue shows that the oil sector of the nation generated about N2.03 trillion in tax, falling slightly short of the FIRS's expectations of N2.3 trillion while the non-oil sector exceeded FIRS's expectations and led to the highest ever recorded first six months tax revenue collection for a fiscal year with a staggering N3.76 trillion tax revenue, making up approximately 68% of the total tax sum above the expected N2.98 trillion of the FIRS. 

 

The Executive Chairman of Nigeria's Federal Inland Revenue Service (FIRS) noted in a comment that June saw the highest-ever recorded monthly tax revenue collection of N1.65 trillion. 

 

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This is a good head start as we work towards meeting our target for the year. And it was achieved despite stubborn headwinds such as the impact of the currency redesign and 2023 General Elections on the economy in the first and second quarters of 2023

 

This half-year performance was achieved as a result of improved voluntary tax compliance by taxpayers, the continued improvement of automation of our tax administration processes, including the updated VAT filing processes; as well as our dogged engagement with stakeholders in both the formal and informal sectors of the economy - Mr Muhammad Nami, Executive Chairman, FIRS 

 

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The functioning Chairman of Nigeria's Federal Inland Revenue Service (FIRS) also disclosed his anticipation of a much better closing tax round on the notes of continuing tax improvement processes and the positive impact of the current government’s policies on the economy. 

 

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We believe that the performance in the second half of the year would be better considering the continuing improvement to our tax administration processes and positive impact of current government’s policies on the economy - Mr. Nami added. 

 

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Reports by Business Insider highlight that the Service collected N10.1 trillion in total in 2022, which was the greatest amount of taxes the FIRS had ever collected in a single year. 

 

Based on the numbers achieved so far, the Federal Inland Revenue Service (FIRS) may expect to surpass this record in 2023.