Dr. Zacch Adedeji, the chairman of the Federal Inland Revenue Service (FIRS), has advised state governments to prepare for the impending tax reforms. A strong Internal Generated Revenue (IGR) system is crucial, as Adedeji noted during the Joint Tax Board’s (JTB) 155th meeting in Suleja, Niger State.
The need to maximise income collection “for socioeconomic and human development” was stressed to the state governments by him.
Dr. Adedeji said that in order to maximise the collection of IGR for socioeconomic and human development, “it is necessary to strengthen the fabric of our IGR capacity at this critical point in time to ensure that the revenue administration processes, especially at the subnational level, become as efficient as possible.”
While praising the Presidential Fiscal Policy and Tax Reforms Committee’s ongoing tax reform initiatives, Adedeji emphasised that “we must begin to look ahead to how these reforms will impact revenue authorities across all government levels.”
He was optimistic that Niger state could reach its monthly IGR objective of N5 billion via the careful use of creative solutions.
Niger State Governor Mohammed Umar Bago gave a case study on the state’s effective IGR improvement, accompanied by Commissioner for Budget and National Planning Mustapha Ndajiwo.
Ndajiwo indicated an increase in Niger State’s IGR, with an average monthly collection of N2,621,710,688.94 between January and May 2024, up from N1,806,280,088.25 in the same time last year. May 2024 alone witnessed a collection of N3,508,389,805.20, marking a 45% rise. Ndajiwo credited this growth to three main strategies: Niger State developed strategic reforms and novel techniques to tax collecting.
The state prioritised openness, efficiency, and taxpayer education, and Niger State actively participates in the Joint Tax Board, a forum for tax officials from all levels of government.
This collaboration enables the sharing of ideas, best practices, and solutions to common difficulties in tax administration and revenue optimisation.
Why this matters
The goal is for states to improve their Internal Generated Revenue (IGR), which is basically their own income source.This reduces dependence on federal handouts and gives them more control over their finances.
With a stronger IGR, states can invest more in crucial areas like education, healthcare, and infrastructure. This can lead to better living standards for citizens.
Bottom Line
Niger State’s example shows that improvements are possible. Their focus on innovative collection methods, taxpayer education, and collaboration with other states demonstrates successful strategies others can learn from.
