Kazeem Owoseni
The Federal Government has disclosed its plan to collect Value Added Taxes from the informal sectors through VAT Direct Initiative.
Disclosing this in a statement issued on Monday, July 3, 2023, the FIRS announced its collaboration with the Market Traders Association of Nigeria, to collect and remit VAT from their members, especially those operating in the informal sector.
According to the agency, the partnership will utilise unified systems technology to facilitate VAT payment and remittance, noting the importance of collaborating with MATAN to enhance VAT collection from members in the informal sector.
“This collaboration is known as VAT Direct Initiative, a collaboration between FIRS and MATAN where MATAN promotes awareness on VAT collection and remittance in the marketplace and informal sector while also simplifying VAT payment and remittance for the marketplace and informal sector using a purpose-built digital platform,” the statement reads.
It explained that the VAT Direct Initiative will take advantage of technology to promote awareness of VAT collection and remittance among market traders and the informal sector of the economy, noting that it will also streamline VAT payment and remittance processes through a purpose-built digital platform.
The agency, however, expressed the belief that the collaboration will not only increase VAT revenue for the government but also contribute to the development of infrastructure and social amenities by providing more funds to the three tiers of government in Nigeria.
Reports revealed that MATAN members will be issued an ID card containing their Tax Identification Number and personal details upon computation.
Moreover, the digital platform will enable tracking of their turnover to ensure proper VAT collection and remittance to the FIRS.
The statement reads partly:
“The Initiative is the first of its kind that will utilize technology to foster collaboration between the FIRS and the marketplace for the collection and remittance of VAT.
“This will also boost VAR revenue generation for the three tiers of government, which in turn means more money to fund infrastructure and social amenities.”
