Federal Inland Revenue Services, FIRS, has announced on Monday it is partnering with a traders association to collect value added tax (VAT) from millions of informal traders, part of a push to widen the tax base by President Bola Tinubu’s government.
The Nigerian Federal Government has recently embarked on perhaps, the boldest reform agenda in decades.
The Federal Government since the advent of President Bola Tinubu has removed the much talked about petrol subsidy and restrictions on foreign exchange trading, as part of the new step of the government to boost the economy and stimulate growth.
The Federal Inland Revenue Agency declared in the statement that it was partnering with the Market Traders Association of Nigeria (MATAN) to collect and remit VAT from its members, especially those in the informal sector, using a digital platform.
FIRS stated that the partnership would help “curb the activities of touts, miscreants and self-imposed tax collectors involved in illegal tax collection in Nigeria’s market spaces.”
The traders body, MATAN on it’s part said that it has more than 40 million traders, mostly in the informal sector where a majority of Nigerians earn a living.
The FIRS stated that MATAN members will receive identity cards with tax identification numbers and a digital platform would track their turnover for tax purposes.
Economic experts have opined that Nigeria has one of the lowest tax collection rates in the world estimated at 10.8% of GDP.
The Federal Inland Revenue Service earlier released it’s analysis that Only 47% of this year’s budget emanates from revenues and the rest from borrowing