FIRS set to impose VAT on online transactions-Fowler

Federal Inland Revenue Service, FIRS tells e-commerce business owners to get ready to start paying for Value Added Tax, VAT on online transactions.

Chairman of FIRS,Mr Babatunde Fowler disclose it during a recent interview with NAN in New York.

He said: “soon, we will ask banks to impose VAT on online transactions for purchases of goods and services. “Not that it is something new; it actually should be in existence.

“We will certainly follow up to make sure that every VAT that is due to be collected is collected.”

According to Fowler, the FIRS generated N1.5 trillion revenue in the first quarter (Q1) of this year which is about 18.7 per cent of the agency’s total revenue target of N8 trillion for 2019.

The chairman said, the agency had started taking action against companies and businesses that refuse to embrace the Federal Government’s tax amnesty programme.

According to him, FIRS hopes to generate between N750 billion and N1 trillion from the clampdown, which includes closure of defaulters’ bank accounts.

We are going after everybody. I am sure you have heard that we have placed lien on some accounts of defaulters that have a billion naira turnover annually. So certainly, we are not leaving anyone out of the tax net,”

On the N1.5trillion generated in the first quarter of the year, Fowler said it included revenue from non-oil taxes that were 11 per cent higher than FIRS realised from that sector in the first quarter of 2018.

He said the N1.5 trillion revenue is also N330 billion or 28 per cent higher than the N1.17 trillion it made in the corresponding period of 2018.

He said, “It is quite realistic as long as we have the cooperation of taxpayers in addition to deployment of technology.

“We have already started the enforcement of over 50,000 accounts that have banking turnover of 100 billion and above that have not filed their returns.

It gave tax defaulters a one-year period of grace to declare and settle their unpaid taxes. There have been complaints by some taxpayers of being wrongly targeted by FIRS in the clampdown.

The FIRS boss also spoke of plans by the agency to surpass the over N1 trillion it realised from Valued Added Tax (VAT) in 2018.
His words: “We will get more people into the tax net and deploy more technology. We have what we call Auto VAT Collect and that basically assists tax payers at the point of transaction, and the VAT portion is sent straight into the federation account.

The N8.83 trillion proposed by President Muhammadu Buhari for spending by the Federal Government in 2019 was based on a revenue target of N6.97 trillion, he said.