FIRS Advocates Withdrawal of Pioneer Certificates from Undeserving Companies

Muhammad Nami

By James Emejo

The Executive Chairman, Federal Inland Revenue Service (FIRS), Mr. Muhammad Nami, Friday decried a systemic abuse of the pioneer incentive scheme instituted by the federal government, which he said, has resulted in tax revenue leakages for the three tiers of government.

He vowed that the service will move to plug the inherent gaps in order to generate more revenue for the government.

Speaking when he received state commissioners of finance who paid him a courtesy visit on Abuja, he said the pioneer status otherwise granted outside the law would not enjoy tax relief regardless of the certificate issued to them, adding that owners of such certificates were requested to regularise their tax positions or risk sanctions in accordance with the law.

In a statement by the FIRS Director, Communications and Liaison Department, Dr. Abdullahi Ahmad, Nami said the FIRS is currently auditing its findings with a view to pressing for the cancellation of pioneer certificates issued to undeserving companies in violation of the law.

Also, the Coordinating Director, Tax Operations Group, FIRS, Mr. Femi Oluwaniyi, lamented the indiscriminate tax waivers and incentives granted to undeserving companies, saying that this had impacted negatively on revenue generation.

He said the service had discovered that pioneer status certificates had been issued to companies that were not pioneers on their fields in the real sense, hence undeserving of such status.

Nami however stated that tax revenue accounted for nearly 70 per cent of what was shared at the last FAAC meeting and lauded the collaboration between the service and the state commissioners of finance, adding that this was key to bringing about increase in tax revenue.

He said without the collaboration, it would be difficult for government to meet its obligations to the citizenry in such areas as infrastructure development and salary payment, which could lead to social dislocation.

He also stressed the need to diversify the economy in order to create more sources of taxable income and increase tax revenue for the country.

He charged the states to focus on other forms of taxes including the stamp duty which he described as the “black gold” which had been ignored before now.

He also charged all ministries, departments and agencies (MDAs) of government to deduct withholding tax from contracts at point of payment.

The FIRS boss further solicited the states’ support in terms of taxpayer sensitization campaigns and education, stating that rental obligation is incomplete without the payment of Stamp Duties.

He added that these initiatives would boost revenue generation at both the local and state levels.