Nigeria: FIRS Launches Centralized Tax Remittance System for States

The Federal Inland Revenue Service (FIRS) has introduced a centralized tax remittance system to streamline tax payments across Nigeria’s 36 states. This new system is designed to simplify the process for state governments, ensuring faster and more efficient collection of taxes.

Speaking at a workshop in Abuja on enhancing tax compliance and revenue generation, FIRS Executive Chairman Dr. Zacch Adedeji highlighted the importance of the new system. He explained that the centralized payment platform allows state accountant generals to manage tax payments on behalf of government agencies, facilitating the swift remittance of taxes like Value Added Tax (VAT), Withholding Tax (WHT), and Stamp Duties.

“The federal government has made it easier to remit taxes through this system,” said Dr. Adedeji. “By centralizing payments, we’ve ensured a smoother process for handling taxes such as VAT, WHT, and Stamp Duties, benefiting both businesses and the government.”

Dr. Adedeji also noted that the FIRS has reduced WHT rates to focus on taxing profits rather than revenue, a move aimed at alleviating the tax burden on businesses. While this reduction may initially lead to a drop in tax collections, he expressed confidence that increased compliance and collaboration would broaden the tax base and offset the difference.

“Accountant generals play a crucial role in this system,” he added. “They are responsible for ensuring that VAT is correctly charged and remitted, Stamp Duties are paid on contracts, and that WHT components in contracts are properly withheld and submitted.”

The new system reflects FIRS’ commitment to improving tax compliance and supporting sustainable revenue generation for both federal and state governments across Nigeria.