President Muhammadu Buhari on Tuesday, October 1, 2019 promised there will be ‘severe consequences’ if any of Nigeria’s revenue-generating agencies fail to meet its set targets.
The president issued the warning during his National Independence address.
Though Buhari did not single out any agency and wasn’t specific on his warning, many believe he was mainly directing his statement to the Federal Inland Revenue Service (FIRS).
The FIRS boss, Babatunde Fowler, was recently queried by the Presidency for consistently underperforming in his revenue collections between 2015 to 2018.
Buhari said: “Our revenue-generating and reporting agencies will come under much greater scrutiny; going forward, as the new performance management framework will reward exceptional revenue performance; while severe consequences will attend failures to achieve agreed revenue targets.”
The president’s warning came weeks after the presidency issued a query to Fowler, over worsening tax collection since 2015.
In the query dated August 8, the Chief of Staff to the President; Abba Kyari said the presidency “observed significant variances between the budgeted collections and actual collections for the period 2015 to 2018.”
Kyari observed that the FIRS in 2015 set a N4.7 trillion revenue target but was only able to make N3.7 trillion in its actual collection.
In 2016, 2017 and 2018, the target collections were N4.2 trillion, N4.8 trillion and N6.7 trillion but the actual collections were N3.3 trillion, N4.0 trillion and N5.3 trillion, respectively.
Worried by the variances, Kyari demanded some explanations from Fowler.
Before his appointment in 2015, the only year FIRS could not meet its collection target was 2006 from the year 2000.
In his response; Fowler agreed that actual tax collections since the beginning of Buhari’s administration were lower than the 2012-2014 period under former President Goodluck Jonathan, in general terms.
But he said that FIRS under him has performed better regarding specific non-oil tax types, such as VAT and CIT.
He, then, associated the general lower collection since 2015 to oil market crisis which has seen a fall in commodity price compared to the period under Jonathan; and recession “which slowed down economic activities.”
