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Tax Committee Urges Action On Nigeria's Tiny Tax Base

by Lorys Charalambous, Tax-News.com, Cyprus

31 August 2016


Only 10m of Nigeria's total population of 180m pays tax, according to the National Tax Policy Review Committee, which has urged politicians to develop measures to expand the tax base as a priority.

The statistic was revealed by committee Chairman Professor Abiola Sanni at a recent stakeholder event, where he called for a new law compelling political parties to declare the measures they would take to increase Nigeria's revenue base.

Nigeria has one of the lowest tax-to-gross domestic product ratios in the world at just six percent, and the Government is largely dependent on revenues from oil, which make up about 60 percent of overall revenues.

The need to widen the country's revenue base has become especially urgent since the fall in world oil prices, and the Government has considered a number of new taxes or tax increases in recent months to buttress its tax take, including most recently a proposed six percent services tax on electronic communications.

Earlier in the year, the Executive Chairman of Nigeria's Federal Inland Revenue Service (FIRS), Babatunde Fowler, said he wanted to substantially increase the numbers of both corporate and individual taxpayers in 2016.

Within a new nationwide campaign to widen the tax base, FIRS registered almost 360,000 more corporate taxpayers in the period from October 13, 2015, to January 27, 2016.

Working in collaboration with the State Boards of Internal Revenue, the FIRS Chairman said he wanted to add five million new individual taxpayers to the country's tax register by December 2016.

The tax authority sees its nationwide program as an avenue to expanding non-oil tax revenue collections considerably, but it remains to be seen how successful the initiative turns out to be.

TAGS: tax | Niger | Nigeria | law | tax authority | services | Work | Tax

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