Nigeria’s biggest risk is servicing debt – Adesina

Calls for increased tax revenue

Emma Ujah, Abuja office manager

the African Development Bank (AfDB) President Dr Akinwunmi Adesina identified debt servicing as Nigeria’s greatest risk and urged the federal government to take action to increase tax revenue in the face of declining oil revenues.

He spoke virtually at the first annual national tax dialogue held recently, according to Federal Internal Revenue Service (FIRS) Communications and Liaison Director Abdullahi Ahmad in a statement. yesterday.

Dr Adesina reportedly said that due to the impact of the COVID-19 pandemic, Nigeria’s economy contracted “by 3% in 2020 due to falling oil prices and the effects of lockdowns on economic activities ”, adding“ with a narrowing. of oil revenues, debt service payments represent Nigeria’s greatest risk. “

He further stressed that for Nigeria to overcome the pandemic, “taxes must constitute a significant percentage of government revenue. Digitization of tax collection and tax administration is key to ensuring greater transparency of the tax system, broadening the tax base, while mitigating compliance risks and encouraging voluntary tax compliance. “

Tax experts and event stakeholders called for the automation of FIRS tax collection through data and intelligence to facilitate tax collection and improve income.

The Executive Secretary of the African Tax Administration Forum (ATAF), Mr. Logan Wort, emphasized the place of technology in generating income for the country in a post-Covid economy.

Mr Wort, who joined the dialogue virtually from South Africa, said: ‘National resource mobilization (DRM) is expected to contribute at least 75% to 90% on average per country’ in the post-Covid era , adding that Nigeria and other African countries should note that “improving tax revenues will have to be high on the agenda”.

He urged Nigeria to pay particular attention to e-commerce and the digital economy sector, where large transnational digital conglomerates like Google, Netflix and Uber are operating and making huge tax-free profits as a possible means of increasing the generation of tax revenue.

He said Nigeria should borrow a sheet from Ghana on e-commerce taxation, which is expected to bring Ghana $ 450 million in annual tax revenue.

Ekiti State Governor Dr Kayode Fayemi, who was chairman of the Dialogue, was cited for praising FIRS “for its performance in FY2020, despite its activities during the most difficult period. . The Service not only collected 4.9 trillion naira in taxes, reaching 98% of its target; Only 30.6% of this sum was allocated to the tax on oil profits, against more than 50% previously ”.

He urged participants to “consider how Nigeria can further deepen the use of technology to improve tax compliance at the national level and between sub-nationals”.

Vanguard News Nigeria

Related