The Senate passed the second reading of the Federal Inland Revenue Service (FIRS) (Establishment) Bill, 2022, on Tuesday.
Sen. Yahaya Abdullahi (PDP-Kebbi North), the bill’s sponsor, gave the lead debate on the bill’s fundamental ideas at plenary.
Abdullahi, who presented the debate, stated that the bill aimed to alter the FIRS (establishment) Act, No. 13, 2007.
According to him, the main goal of the amendment bill was to ensure that the procedures for awarding corporate tax vacations and import duty waivers to foreign investors and firms were controlled and better organised.
According to Abdullahi, the bill became required for two linked reasons. The first was the issue of the government’s severe revenue deficits, which led to an increase in deficit spending and a high debt profile.
“Hence the need to block leakages and loopholes in tax collection and due remittances to government.
“The other reason was the mounting financial demands to fund equally increasing government public expenditures, particularly our national budgets on public infrastructure, security and welfare commitments.
“It is important for parliament to be aware of the dire predicament of our economic circumstances today and the danger we face if we fail to reign-in the twin threats of deficit spending and high indebtedness.
“On the surface, it is easy to say that Nigeria is in safe territory because our public debt of 23.6 per cent of the GDP is still within our 40 percent threshold and the 55 percent estimated by the IMF for economies of our size.
“The devil in our case is that debts are serviced with revenues government derives from its GDP, which in our case is abysmally low (about 6-7 percent of the GDP),” he said.
Approximately N6 trillion in anticipated revenue, he claimed, was not accessible due to tax and import duty waivers, as had been widely reported.
“This clearly indicates the spectre of the difficult times ahead.”
Some of the waivers, according to Senate President Ahmad Lawan, were completely unnecessary.
“Why should we give waivers in trillions and then we borrow money from somewhere. It doesn’t make sense,” he said.
Lawan then referred the bill to the Senate Finance Committee for additional legislative action, with a deadline of four weeks.
