FIRS Warns Ministries, Departments and Agencies Against Outsourcing Tax Collection and Enforcement to Consultants

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The Federal Inland Revenue Service (FIRS) has warned government departments, departments, and agencies (MDAs) not to hire consultants or dealers to collect taxes owed to the federal government or any of its agencies.

This was revealed in a statement released by FIRS Executive Chairman Muhammad Nami based on a report by NAN.

Nami expressed concern that some MDAs engage in assessment, collection, accounting and enforcement of taxes and levies in their agreements with concessionaires and consultants.

What FIRS says

The press release stated, “FIRS has learned that some MDAs appoint licensees or consultants for the assessment, collection, accounting, or application of taxes and levies due to the Federal Government or one of its agencies.

“Some MDAs include these functions in their agreements with dealers or consultants.”

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Nami said that Section 68(2) of the FIRS Act highlights that “The principal agency responsible for the administration, assessment, collection, accounting and enforcement of taxes and levies due to the Federal Government or any of its agencies is the FIRS.

“This is unless authorized by the Minister responsible for finance by regulation approved by the National Assembly. »

According to him, while Section 12(4) of the FIRS Act provides that the service may engage consultants, accountants or other agents to perform certain functions on its behalf, the law expressly prohibited the carrying out of the assessment and tax collection by consultants.

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What you should know

  • Nairametrics reported that the FIRS is planning to start applying and recovering unpaid tax deductions owed by some Nigerian states and local governments.
  • The Federal Inland Revenue Service (FIRS) has also said it will begin the process of applying and recovering unpaid tax deductions owed by certain state and local governments in Nigeria.
  • Due to the failure of defaulting states and local governments to deliver, the FIRS has advised the Federal Government and the Minister of Finance to withhold approval of any request to issue government bonds or other securities. in the capital market, as well as requests for external borrowings and approval of internal loans from commercial banks or other financial institutions by any of the state and local governments.
  • The Federal Inland Revenue Service (FIRS) has also announced that it will begin a Value Added Tax (VAT) and withholding tax compliance exercise in July 2022.

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