The Federal Inland Revenue Service (FIRS) has projected N1.8 trillion Value Added Tax (VAT) collection for 2017 fiscal year.
The Executive Chairman of the service, Mr Tunde Fowler, made the projection while defending the 2017 budget of the service before the Senate Committee on Finance on Tuesday in Abuja.
Fowler said the budget was aimed at increasing VAT and other non-oil revenue.
He said that VAT was meant to increase from an actual of N828 billion to a budget of N1.8 trillion, which is over 125 per cent increase.
“The Service, in realisation of this responsibility and challenges of doing manual collection, has automated VAT collection for the critical sectors of the economy, notably telecommunications, airlines and financial institutions,’’ he said.
Fowler said that the service had proposed to achieve the tax revenue target as derived from the 2016-2018 Medium Term Revenue Framework (MTRF) for 2017, amounting to a total of N4.89 trillion.
On budget parameter, Fowler said that the 2017 projected cost of collection of N153 billion was higher than the 2016 approval estimate which stood at N144 billion.
The figure, he said, represented a cost of collection increase of 6.63 per cent on overall projected non-oil revenue, including VAT, stamp duties and levy.
On the revenue projections performance for the period January to June 2017, the FIRS boss said that the analysis showed that the service had recorded an increase of N224 billion.
He said this represented an overall increase of 14 per cent in 2017, compared with collection performance for the corresponding period in 2016.
“We have achieved 72.93 per cent of our half year target of N2.44 trillion for 2017 as against 74.2 per cent of N2.1 trillion for the corresponding period in 2016.
“The chairman may note that we attained this collection performance despite several challenges.
“We have continued to vigorously pursue our strategies internally, while improving collaboration with relevant stakeholders to boost our collection.
“The strategies put in place are on course and progressively yielding fruits. We are hopeful, therefore, that the efforts being made will translate to significant tax yields before the end of 2017,’’ he said.
The Chairman Senate Committee on Finance, Sen. John Enoh, spoke on the need for the FIRS to work to achieve the approved target.
He said, with a deficit of over N2 trillion, if the service failed to meet its target, it would impact negatively on the implementation of the 2017 budget.
The lawmaker suggested the need for a mid-term engagement between the committee and the service to block loopholes.