State Governors revealed that the States’ Internally Generated Revenue (IGR) fell from N1.31 trillion in 2019 to N1.67 trillion in 2021 due to tax reforms.
Chairman of the Nigerian Governors Forum (NGF) and Governor of Ekiti State, Kayode Fayemi revealed this during the 8th IGR Peer Learning Event and Launch of the Governors Database. public finances of the NGF in Abuja.
According to him, governors in 2019 decided to be deliberate with the reform of tax administrations to become more efficient and effective.
He said consensus reforms focused on ending multiple taxation; professionalize and modernize tax services; Embrace a taxpayer-centric culture that facilitates taxpayer compliance and reinforces the existing social contract.
Fayemi said that this pact gave birth to the State Action Plan for Revenue Generation (SAPRG), whose implementation progress they will review with the aim of highlighting what has worked and what governors need to do better to foster a favorable fiscal environment and administration that allows them to maximize their revenue potential as a subnational.
He said, “We have seen total state RGI increase from NGN 1.31 trillion in 2019 to NGN 1.67 trillion in 2021 and the share of RGI (as % of total recurring revenue) has increased from 31 % in 2019 to 35% in 2021. .
“While this is a good step forward, we must not lose sight of the need to maintain and advance the momentum of reforms, given the decline in FAAC revenue.
“Our renewed effort must take into consideration the emerging dynamics surrounding private incomes in Nigeria today, including the devaluation effect of the rising rate of inflation, the structural transition of employment, trade relations and investments, driven by the evolution of technology.
“Beyond the laws and regulations we have passed, we sometimes need to provide policy responses to the rapidly changing tax environment, if we are to stay ahead of evasion and avoidance tactics.
“We recognize the need to support our internal tax departments and to continue to provide them with the political support and financial resources necessary for them to carry out their mandate effectively.
“We remain committed to maintaining this pact. However, mutual accountability must exist – to whom much is given, much is expected.
Overall, we need to look at ways to expand the tax net and improve our taxpayer database. This will require ending the proliferation of taxpayer identification numbers and databases.
“It is relevant that we harmonize; leveraging a unique ID number, as is global best practice. For us to achieve this, the sharing of information between jurisdictions must be transparent, not only between levels of government, but also inter- and intra-state.
“By strengthening public legitimacy for tax collection, we have improved transparency not only of tax revenues, but of the entire treasury.
“Today, our audited budgets and financial statements are not only publicly available, but also in citizen-friendly versions. This will be supported by the NGF Public Finance Database that we will be launching today. »
According to him, governors are working with their tax departments and other MDAs to expand their tax-for-service initiatives by rewarding compliance while ensuring citizens know where they spend their taxes each year.
He said the launch of the Nigeria Public Finance Database – Nigeria’s first benchmark database for public finance data at the state level, reiterates their commitment to transparency and accountability and their determination to strengthen governance in the country.
“I am optimistic about the course of tax reform and believe that even in the time some of us have left, we can achieve a lot.
“As it is often said, government is a continuum, so I trust those who will follow us to continue with these reforms and many others, which may be necessary to guarantee the fiscal sustainability of our states,” he said. -he adds.
On his part, the Director General of the NGF Secretariat, Asishana Okauru, said that the country’s first open source database of tax data from the 36 state governments will also be launched today.
According to him, the portal will house comparable annual data on government spending, revenue and funding across states, and feature hundreds of performance indicators that measure the quality of government spending and the intersection of government spending. public finance and service delivery in the country. .