Certain ouster clauses in the Finance Bill has set the Federal Inland Revenue Service (FIRS) and the supervisory Ministry of Finance on collision course with the Revenue Mobilisation and Fiscal Commission (RMAFC), a development analysts have argued, has dire consequences for revenue generation by these government ministries, department and agencies (MDAs) reports Ibrahim Apekhade Yusuf
When the idea of the Finance Bill was being conceived nobody ever thought it would be a subject of controversy somehow such that it would pit agencies of government against one another.
But that unfortunately is the unintended consequences that have heralded the Finance Bill which has become hotly debated by stakeholders including the Federal Inland Revenue Service (FIRS), the supervisory Ministry of Finance and the Revenue Mobilisation and Fiscal Commission (RMAFC).
The Finance Bill was passed by the National Assembly after consideration of the report by the Joint Committee on Finance; Customs, Excise and Tariff, Trade and Investiment on Tuesday, December 21, 2021.
Presenting the report, the Chairman of the Joint Committee, Sen. Solomon Adeola (APC-Lagos), said the bill seeks to support implementation of the 2022 Federal Budget of Economic Growth and Sustainability by proposing key specific taxation, customs, excise, fiscal and other relevant laws.
According to him, a total of 12 Acts were amended under the finance bill which contains 39 clauses.
He said the bill seeks to promote fiscal equity, align domestic tax laws with global best practices, introduce tax incentives for infrastructure and capital markets, support small businesses and promote increase government revenue.
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“The Finance Act 2020 was predicated essentially on having no new taxes and no new incentives due to the COVID-19’s impact on the economy as such it was structured across four broad thematic areas.
“Enacting counter cyclical measures and crisis intervention initiatives; Tax, fiscal responsibility, and public procurement reforms; Reforming fiscal incentives policies for job creation; Ensuring closer coordination of monetary, trade and fiscal policies; and Enhancing tax administration,” Adeola said.
Crux of the matter
According to the RMAFC, the Finance Bill has certain ouster clauses which has serious implication on its constitutional mandate.
RMAFC is a Federal Government agency constitutionally empowered by paragraph 32 (a-e) parts 1 to the Third Schedule of the 1999 constitution (as amended) among others; to monitor all revenue accruals to and disbursement of revenue into the Federation Account.
While the FIRS is saddled with the responsibility of collection of tax revenues on behalf of the federal government.
In a press statement signed on behalf of the Commission by Chairman, Public Affairs and Communications Committee, Dr. Rilwan Hussein Abarshi, he said the Finance Bill in its current state without proper amendments to some of the clauses will not bode well for the economy.
Specifically, he said: ”The amendment to S.68(1-6) of the FIRS establishment Act and Section 4(1-3) of the Finance (Control and Management Act if passed; will infringe on the constitutional mandate of monitoring accrual into the Federation Account as well as revenue payable into the Consolidated Revenue Fund of the Federation from the Nigerian National Petroleum Corporation ( NNPC), Nigerian Customs Service (NCS), the Board of Federal Inland Revenue Service (FIRS), Central Bank of Nigeria (CBN), Nigerian Ports Authority (NPA),Nigerian Maritime Administration and Safety Agency, (NIMASA), the Federal Ministry of Finance (FMF and other revenue generating agencies.
“The Finance Bill will foreclose any form of checks and balances as envisaged by the 1999 constitution, whilst exposing government revenues to leakages as all under remittances or unremitted funds will not be checked by government agencies.
“It will cause inter-agency conflicts, unnecessary litigation and disservice to the nation just as the Commission will not be able to pay the engaged consultants after recovery and the engaged consultants may drag the Commission to courts.”
To address these grey areas, Abarshi, therefore impress on the top hierarchy of National Assembly including Senate President Ahmed Lawan, Speaker Femi Gbajabiamila, Chairman of the Senate Committee on Finance, Senator Solomon Olamilekan Adeola and other members in both the upper and lower chambers the need to look into the areas of conflict in the proposed bill.
THE NATION
