The federal government says it will publish a report on all
the individuals and organisations that received tax exemptions and rebates in
2019.
Speaking when presenting the 2021 budget at the national
assembly on Thursday, President Muhammadu Buhari said the report will
contribute to public discussion on the use of tax policies.
Tax rebate represents a refund of monies already paid to the
government as taxes while exemptions mean that the party has not paid any tax.
“In compliance with the Fiscal Responsibility Act of 2007, we will prepare and publish, a tax expenditures Statement for 2019,” Buhari said.
“The 2019 statement will be the first of these annual
statements, setting out the estimated cost of tax exemptions, incentives and
rebates provided under Nigeria’s revenue and other laws.
“The 2019 statement is expected to contribute to public
discussion on the use of our tax policies and system to achieve socio-economic
development.”
There have been campaigns and efforts to encourage tax
compliance in Nigeria to increase revenue for the federal government.
Some international agencies including the International
Monetary Fund (IMF) and ActionAid have said Nigeria is losing a lot of tax
revenue to tax rebates and exemptions.
There are various tax incentives in Nigeria to encourage
investments and relieve the tax burden on small and medium scale enterprises.
One of such is the pioneer status incentive that exempts
companies from certain industries from company income tax for an initial period
of three years with the possibility of an extension for one or two years.
In August, the Federal Inland Revenue Service (FIRS) said
the government is losing revenue to tax waivers been granted to undeserving
companies.
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