The task before the new FIRS helmsman

The Federal Government recently appointed Babatunde Fowler as acting executive chairman of the Federal Inland Revenue Service (FIRS) to replace Sunday Ogungbesan, who was appointed to the position by ex-President Goodluck Jonathan in March this year.

The new FIRS boss was chief executive officer/executive chairman of the Lagos State Board of Internal Revenue from 2005 to 2014. Under his leadership, the Lagos State Board of Internal Revenue reportedly achieved a sharp increase in internally generated revenue from an average of N3.6 billion per month in January 2006 to an average of N20.5 billion per month in 2013. He has promised to replicate the feat at the national level by ensuring that all leakages are plugged, while promising transparency in the operations of the agency.

Fowler, a Fellow of the Chartered Institute of Taxation of Nigeria and the Business Management Association of the United Kingdom, had his higher education in the United States, where he obtained a Bachelor’s degree in Economics from the University of Wisconsin and a Master of Business Administration degree from the California State University.

Given his pedigree, we have no doubt that Fowler is capable of delivering on his new job. However, we wish to urge the new chairman not to jettison some of the good initiatives begun by his predecessor but rather leverage on them in order to take the FIRS to the next level.

At his last public outing before he was removed, for instance, Ogungbesan said that FIRS was discussing with the Corporate Affairs Commission (CAC) to make it mandatory for companies to obtain their Tax Identification Number at the point of registration. In the reckoning of the former FIRS boss, the new measure would enable the service to bring more companies into the tax net, thus boosting Federal Government revenue.

According to the former chairman, of about 450,000 companies in Nigeria, only about 125,000 paid any form of tax. The implication is that not less than 325,000 companies in the country are evading tax, thereby denying the FG of huge revenue annually. Through the collaboration with the CAC, he said, it would be easier to determine the level of turnover or business activity of a company within the year, which would in turn enable the FIRS to overcome situations where organisations submit fake annual returns of their activities.

Furthermore, out of the N4.5 trillion revenue generation target given to the FIRS by the Federal Government in 2015, the former chairman said the agency had already generated N2.667 trillion. The estimated collection for July 2015 alone, he said, was N404 billion, a substantial improvement on the monthly target of N381.02 billion.

For us, these are good records that the new FIRS boss can build on. It is heart-warming to read reports already suggesting that the new management at the FIRS intends to go after the 325,000 companies in the country that are not paying tax. That, in our opinion, is the way to go.

With the groundwork done by his predecessor, we believe the new boss has good grounds to realise his ambition of replicating or possibly surpassing his records in Lagos State to the benefit of the entire country, in spite of unforeseeable challenges that may arise. And expectations are high that with Fowler at the helm of affairs at FIRS, the country’s aim of boosting the much-needed non-oil revenue would be fully realised.