•Says policy poses negative impact on OPSorganised businesses –NECA
By Chukwuma Umeorah
Nigeria Employers Consultative Association (NECA), the umbrella association of private sector organisations in Nigeria, has said that the recently implemented updates by the Federal Inland revenue Service (FIRS) on its TaxProMax platform was illegal as it claimed it would have negative impacts on organised businesses and be counter-productive to tax remittance in the country.
The Director General of NECA, Adewale-Smatt Oyerinde, in a statement to FIRS, yesterday called for the immediate reversal of the policy pending the amicable resolution of the challenges inherent in it and the establishment of its legality.
He noted that organized businesses in the country already face a barrage of challenges and it would be unfair to add the problem of a rather complex tax remittance procedure.
According to him, “Policies and programmes of government or its agencies should, ordinarily promote enterprise sustainability and competitiveness. However, the recent policy by the FIRS seems to negate government’s Ease-of-Doing-Business efforts, places unnecessary administrative burden on businesses.”
“The policy is tantamount to the FIRS abdicating its responsibility to collect Value Added Tax (VAT) from suppliers and also lacks any legal foundation to impose additional burden on purchasers of raw materials and retailers in view of Section 15(1) and Section 17 of the VAT Act, among others,” He said. He added that the effort made by the FIRS at creating awareness on the new policy through a stakeholders’ engagement was vexatious and belated, as the engagement should have preceded the implementation of the policy. “We view the belated enlightenment as an attempt to confer legality on an otherwise illegal issue.”
Oyerinde further explained that where the objective of the FIRS is to ensure suppliers remit input VAT claimed by purchasers, the FIRS may appoint purchasers as agents of collection whereby they pay the VAT charged by suppliers directly to the FIRS and claim the corresponding input VAT.
According to him, “The current approach of paying to the supplier and waiting for the supplier to remit and upload on TaxPro Max is counter-productive to the FIRS and Taxpayers, with potential to further portray Nigeria as a inhospitable environment to do business.”