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In a strategic move to modernize tax administration and foster voluntary compliance, the Federal Inland Revenue Service (FIRS) has commenced stakeholder consultations on its electronic invoicing (e-invoicing) initiative. The engagement, held recently in Lagos, brought together key players from the manufacturing and oil and gas sectors to discuss the implementation framework and operational benefits of the new digital system.
Speaking at the forum, the Lead Consultant to FIRS, Mr. Sadiq Arogundade, emphasized that the e-invoicing system is being designed to automate tax compliance processes while reducing the administrative burden on businesses.
“We have developed an electronic invoicing solution to support taxpayers in managing their invoicing workflows efficiently,” Arogundade said. “This stakeholder forum is critical in gathering feedback, addressing sector-specific use cases, and incorporating business concerns into the system’s final design.”
He explained that the core objective of the e-invoicing platform is to integrate tax obligations—such as VAT, withholding tax, and corporate income tax—directly into the invoicing lifecycle, allowing FIRS to extract the relevant tax data in real time.
“By automating workflows, businesses will spend less time on manual bookkeeping, while ensuring their tax reporting is accurate and timely,” Arogundade added.
Real-Time Tax Transparency and Systemic Efficiency
Echoing this vision, Acting Director of Tax Automation at FIRS, Mr. Mike Adoga, described the initiative as a game-changer for revenue administration. According to him, the e-invoicing platform will enable real-time visibility of transactions between businesses and their clients, powered by FIRS digital infrastructure.
“This system enables electronic, real-time exchange of invoices, which significantly enhances transparency, accuracy, and overall efficiency in tax reporting,” Adoga said.
He noted that the platform is expected to capture VAT at the applicable 7.5% rate, alongside other tax categories including company income tax, personal income tax, and withholding tax. The latter, he emphasized, functions as an advance payment mechanism for future tax liabilities.
Bridging Knowledge Gaps Through Stakeholder Dialogue
Adoga also acknowledged the prevailing misconceptions surrounding e-invoicing, stressing the importance of proactive stakeholder engagement in fostering broader acceptance.
“Many stakeholders have heard of e-invoicing, but may not fully understand its operational impact. These forums help clarify the system’s purpose, functionality, and compliance benefits,” he said.
He encouraged businesses to embrace the initiative as a tool for reducing tax disputes and strengthening their internal financial governance structures.
Aligning with Global Standards
The e-invoicing initiative represents a key component of FIRS’ broader digital transformation agenda aimed at closing revenue leakages, expanding the tax net, and aligning Nigeria’s tax administration system with international best practices. As the project progresses, FIRS reaffirmed its commitment to sustained collaboration with stakeholders to ensure the system is inclusive, adaptable, and effective across various sectors.
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