THE Federal Inland Revenue Service (FIRS) has decided to capture the petty traders in the tax net in its bid to widen the tax net and curb the high level tax evasion in the informal sector.
Acting chairman of FIRS, Kabir Mashi, speaking at a sensitization workshop on Presumptive Tax Regime, organized by the FIRS for the stakeholders, observed that the taxes of petty traders, small businesses are not properly structured and they are unable to keep and detailed records of their business transactions.
He further observed that the challenge was not peculiar to Nigeria but common in most developing countries.
He said “almost every country had at one time or the other been faced with the challenge of how to bring such businesses into the tax net and ensure that those businesses complied with their tax obligations.
Different countries have, therefore, fashioned out different strategies to effectively tax individuals in this category. Some countries in dealing with this issue have leveraged on the experiences of others while others decided to fashion out their own specific strategy.
“It is in this regard that this stakeholders’ sensitization workshop is being held to provide a platform and forum for relevant stakeholders to come together and share ideas based on their experience and knowledge of similar regimes elsewhere.”
Mashi explained that the presumptive tax regime would create improved and easy access to the tax system by the large pool of taxpayers in the informal sector.
This, he said, would enable the service to not only grow the tax base across the three tiers of government but more importantly, improve tax collection from non-oil tax revenue.