Revenue generation: FIRS calls for collaboration among African countries on digital tax

The Federal Inland Revenue Service (FIRS) has reached out to other African countries to collaborate with it to effectively tax digital businesses.

Executive Chairman (FIRS) Muhammad Nami, made the call at a Technical Assistance Programme organised by African Tax Administrators’ Forum’s (ATAF) with the theme, “Member’s needs and how to broaden the collaboration,” in Lomé, Togo.

In a statement by Johannes Oluwatobi Wojuola, Special Assistant to the Executive Chairman, FIRS, quoted Nami as saying, “Nigeria continues to hold the view that the outcome will produce very minimal revenue comfort for African counties.This is instructive considering the implementation challenges that developing jurisdictions will face due to the complexity of the Pillars 1 and 2 rules.”

Nami noted that while some African countries have endorsed the Organisation for Economic Co-operation and Development (OECD) global solution on the tax challenges of the digitalised economy, Nigeria would continue to maintain its position that the outcome would not be favourable to African countries.

“Our analysis continues to show that the possible cost of administering and implementing the complex rules will far outweigh the expected revenue accruing from its implementation.”

He urged the African Tax Administrators Forum to join the discussion at the UN Tax Committee of Experts, South Centre.

Nami appealed to other African countries to collaborate with  other stakeholders to explore alternatives that would enable African countries to subject the digital businesses and base eroding payments to tax in our jurisdictions.