Haruna Abdullahi, Acting Chairman of the Federal Capital Territory (FCT) Internal Revenue Service (FCT-IRS), has suggested that only 10% of registered taxpayers in the nation’s capital pay their taxes.
This means that 90 percent of FCT residents who are registered for tax do not file returns.
He made this remark during a day-long tax seminar in the nation’s capital aimed at reviving the culture of filing tax returns.
Abdullahi explained that, in response to this challenge and to mitigate its impact, the Service had introduced Key Account Managers (KAM), who follow up with taxpayers one on one.
According to him, “from our records, the number of taxpayers under the PAYE scheme is approximately 120,000, with half of the figure comprising staff of Federal Government Ministries, Departments, and Agencies (MDAs) on the IPPIS platform, as well as those working for the FCTA and the Area Councils.”
“This implies that 90% of FCT residents registered for tax do not file their tax returns, implying that only 10% of registered taxpayers file their tax returns.”
“In response to this challenge and to mitigate the impact, the Service has introduced Key Account Managers (KAM), who follow up with taxpayers one on one,” he explained.
The chairman was hopeful, however, that the seminar would address the issue of low tax compliance among residents, as taxes and levies are the most sustainable source of public finance.
“It is therefore prudent that we develop measures to best mobilise our internal resources,” he added.
According to the Ag chairman, when the Service took over tax administration in the FCT from the FIRS in 2015, the highest amount collected was about N48 billion, but by 2021, the Service had collected more than N100 billion, with an additional N26 billion in recoveries of unremitted With-holding Taxes (WHT).
Read also: Katsina NNPP petitions INEC to disqualify Tinubu, Atiku from office
‘”This year, we intend to increase our collection to N150 billion and are well-positioned to recover some unremitted taxes and levies, bringing us to a targeted collection figure of N200 billion,” he said.
Abdullahi stated that with improved compliance by the remaining residents, the Service can provide a consistent annual tax income of N300b to N400b, allowing for high employment, reducing low income, and providing enhanced services to residents.
The Ag chairman emphasised the importance of reviving the culture of filing tax returns because it is critical to providing funding for the government to deliver public services that are critical to the FCT’s long-term development.
“Recalling our starting point and where we are now will help steer the conversation in the desired direction,” he said.
Dr. James Naiveju, Managing Director of JK Consulting, urged the legislature, the judiciary, public servants, and professionals to ensure timely and complete filing of their tax returns in his keynote address.
According to Naiveju, if all FCT residents agree to file their tax returns correctly, the economy will improve and the poverty rate will decrease.
He, on the other hand, urged the FCT-IRS to simplify the tax return process by making it electronic and accessible via smartphones and other devices.
“A proud resident of the Federal Capital Territory has a moral and civil responsibility to file their tax returns with utmost patriotism to the fatherland.”
“There must also be patriotism, determination, and political will on the part of the authority to ensure that citizens file their tax returns on time.”
