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The Federal Inland Revenue Service (FIRS) exceeded its 2023 revenue target by N816 billion, achieving a remarkable 107% performance over the set goal. Looking ahead, the FIRS has set an ambitious target to collect N19.4 trillion in taxes this year.
Amina Ado, the Coordinating Director of the Special Tax Operations Group, made this announcement during the 2024 management retreat on Wednesday. The Federal Government anticipates receiving N19.41 trillion in revenue from the FIRS in 2024, reflecting a substantial increase of 56.9% from the previous year’s actual revenue and 67.91% from the previous year’s target.
In 2023, the FIRS had set a revenue target of N11.56 trillion but exceeded expectations by realizing N12.37 trillion, surpassing the goal by N816 billion. Ado outlined the strategies the agency plans to deploy to achieve the N19.4 trillion revenue target, emphasizing continued engagement with regulators, tax practitioners, intermediaries, and the withholding concept to expand the tax base within the confines of the law.
Ado stated, “These are strategies we will deploy to ensure we deliver on this ambitious target.” She highlighted the importance of improving service delivery to taxpayers, reorganizing litigation and prosecution processes, and leveraging technology to facilitate easy tax payments.
The FIRS recorded a 21.7% increase in its 2022 revenue, reaching N10.18 trillion. The trend of increasing projected revenue has been consistent from 2019 to 2023, with figures of N5.262 trillion, N4.952 trillion, N6.403 trillion, N10.179 trillion, and N12.374 trillion, respectively.
According to Ado, Company Income Tax accounted for 36.14% of the total taxes collected in 2023, followed by Value Added Tax (N3.64 trillion) and Petroleum Profit Tax (N3.17 trillion). The Federal Government is expecting more taxes from the oil sector, projecting about N9.96 trillion, a significant increase of 214.2% compared to the previous year.
Ado attributed the sustained growth in revenue collection to FIRS’s administrative reforms, including the automation of tax collection processes, the introduction of TaxPro-Max, and the use of third-party data for enhanced tax intelligence. Policy reforms, such as increases in VAT and Education Tax rates and improvements in tax laws through Finance Acts, have also played a vital role.
While acknowledging the challenges ahead, including global economic uncertainties and fluctuating oil prices, Ado expressed the FIRS’s commitment to national duty and confidence in its ability to meet and exceed its targets.
Zacch Adedeji, the Executive Chairman, emphasized the focus on driving long-term compliance and highlighted the shift from a functional tax unit to a customer-centered approach. He stated, “The real strategy is to drive compliance, and the way to do it is that there will always be consequences for noncompliance.”
As the FIRS embarks on its ambitious revenue target for 2024, the agency remains resolute in its commitment to overcoming challenges and contributing significantly to the nation’s economic goals.
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