Expert tells FIRS to simplify tax processes for MSMEs
The Federal Inland Revenue Service, FIRS, has been called upon to ensure simplification of tax processes in order to attract Micro, Small and Medium Enterprises, MSMEs, to the tax net.
Fiscal Policy Partner of Pricewatercoopers, Dr Taiwo Oyedele, made the call at the Public-Private Dialogue/Survey Launch hosted by the Lagos Chamber of Commerce and Industry, LCCI, and Centre for International Private Enterprise, CIPE.
The dialogue had as its theme: ‘Transactional Accountability, Process Consistency and Operational Transparency of the Federal Inland Revenue Service.’
Oyedele said the inclusion of MSMEs, which account for about 96 per cent of businesses in Nigeria, into the FIRS tax net would improve the revenue generated for the Federal Government.
According to him, the simplification process includes the creation of a redress mechanism without retribution and a simplified subsection in the FIRS portal, dedicated to attending to the needs of MSMEs.
The financial expert, however, said trust must be built between the MSMEs and the government on infrastructure delivery among other ease of doing business mechanisms, to ensure a smooth taxation process.
His words: “FIRS should create a dedicated portal within the portal for MSMEs, simplified and without the technical terms, to address problems with taxes.
“The FIRS should also deploy the use of technology and pass a law on usage in filing tax returns to adequately block all leakages and ensure that the taxes get to the government.
“FIRS must find a way to connect with small firms that address SMEs tax concerns.
“People pay taxes while the government gets little, but it gets lost due to corruption, leakages among others.
“We also need to build trust and feel the impact of the government on making business processes clear and smooth."
On his part, Mr Soji Apampa, co-founder, Convention on Business Integrity, CBI, who presented details of a survey on MSMEs and FIRS, said 501 businesses were sampled out of which 376, 76 and 49 of them in Lagos, Abia and Kano, respectively.
He said the survey sought to find out issues around service satisfaction, complaints redress mechanism and examine the actual cost and time involved in procuring services by MSMEs from the FIRS.
Apampa said the key findings of the survey revealed that MSMEs do not deal with FIRS in respect of payment of all taxes, adding that they were, however, not exempted from payment of some taxes in real and practical terms.
According to him, the respondents listed reasons for un-receipted payments to include ‘thank you’, fast track process, reduced liability, reduced sanctions, and for correct interpretation of regulations.
He, however, revealed that 64 per cent of MSMEs responded satisfactorily to the services rendered by the FIRS.
“The high demands of fast track processes by MSME can be looked into as a sort of specialized service by the FIRS to improve revenue into the government coffers,” he said.
Responding, the FIRS Chairman, Mr Muhammad Nami, said that the FIRS does not charge or receive payments for its services.
Nami, represented by Mr Mathew Gbonjubola, Policy Director, FIRS, said most MSMEs had their tax dealings with state-owned internal revenue services.