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From Fred Itua, Abuja
The Senate, through its Committee on Finance, has kicked against the proposed N6 trillion tax and import duties waivers for the N19.76 trillion 2023 budget with attendant deficit of N12.4 trillion .
It, therefore, directed the Nigeria Customs Service (NCS) to carry out downward review of the proposed waivers by 50 per cent and also tasked the Federal Inland Revenue Service (FIRS), to critically look into seeming abuse of tax credit by some companies.
These were the fallouts of the interface between the committee and Minister of Finance, Budget and National Planning, Zainab Ahmed, as well as heads of revenue generating agencies in the country on proposed 2023 to 2025 Medium Term Expenditure Framework ( MTEF) and Fiscal Strategy Paper (FSP).
The finance minister had, at the interactive session, yesterday, informed the committee that the proposed N19.76 trillion 2023 budget will have deficit of N12.43 trillion as a result of projected N6 trillion tax and import duty waivers and fuel subsidy of over N6 trillion as well, if retained for the whole year.
Worried by the submission, the committee Chairman, Solomon Olamilekan, told the minister that both the projected N12.43 trillion budget deficit and N6 trillion tax and import duty waivers should be critically reviewed downward before sending the proposals to the National Assembly for consideration and approval.
He specifically told the minister to look into the list of beneficiaries of the waivers for required downward review to N3 trillion with attendant reduction of N12.43 trillion deficit figure.
He said: “The proposed N12.43 trillion deficit for the 2023 budget and N6 trillion waivers are very disturbing and must be critically reviewed.
“Many of the beneficiaries of the waivers are not ploughing accrued gains made into expected projects as far as infrastructure developments are concerned.
“The same goes for tax credit window offered by FIRS to some companies.
“Billions and trillions of naira can be generated by government as revenue if such windows are closed against beneficiaries abusing them and invariably provide required money for budget funding with less deficit cum borrowings.
“NCS should help in this direction by critically reviewing waivers being granted on import duties for some importers just as the FIRS should also review the tax credit window offered some companies without corresponding corporate social services to Nigerians in terms of expected project executions like road construction.
“Generally, the issue of waivers should be taken strongly by relevant authorities because Nigeria does not have the capacity for now. We cannot accommodate this N6 trillion tax waivers.”
However, FIRS Chairman, Muhammad Nami, told the committee that tax credit is an important innovation of government which has yielded positive results from September 2019 when it was introduced through Executive Order 007 by President Muhamnadu Buhari .
He urged the committee not to move in the direction of scrapping it as it is only given to companies with evidence of projects execution.
He informed the committee that out of the N6.08 trillion projected revenue from January to July 2022, FIRS generated N5.59 trillion and assured the N10.4 trillion projected for the year will be achieved.
NCS Comptroller General, Hammed Ali, also assured the committee of improved revenue generation in 2023 fiscal year. The interface continues today with expected appearances of Central Bank of Nigeria Governor, Godwin Emefiele, and Group Managing Director of Nigerian National Petroleum Corporation Limited, Mele Kyari, before the committee.
