By Ayo Kehinde
In a terse Monday 8 query to the Chairman of the Federal Inland Revenue, FIRS, Mr Babatunde Fowler, Alhaji Abba Kyari, Chief of Staff to President Buhari, urged tax agency’s boss to explain the mismatch in figures budgeted for and collected and submitted to the Federal Government for 2015 to 2018.
According to him in the memo, personally signed by him and addressed to Fowler, RE: BUDGET FIRS COLLECTION AND ACTUAL COLLECTIONS, Kyari queried; “We observed variances between the budgeted collections and the actual collections for 2015 to 2018.
“Accordingly, you are kindly invited to submit a comprehensive variance analyses explaining the reasons for the variances between budgeted and actual collections for each main tax item for each of the year 2015 to 2018.
“Furthermore, we observed that the actual collection for the period 2015 to 2017 were significantly worse than what was collected between 2012 and 2014. Accordingly, you are kindly invited to explain the reasons for the poor collections…”
Fowler in his reply made a quick work of the query by identifying the said gaps in the revenue collected to indicate that the possibility of inefficiency or trickery implied in the Chief of Staff query was erroneous.
According to him, in his letter FIRS/EC/CWP/0249/19/030, dated August 19, addressed to Kyari and titled RE: BUDGETED FIRS COLLECTION AND ACTUAL COLLECTION, the implied differences in revenue collected in 2013 and 2014 was a factor of the prevailing high revenue yields from oil imports vs non-imports as against the subsequent periods in 2015 to 12107 when revenue from oil exports had dwindled. And as he noted, the mandate of Federal Inland Revenue, FIR covers non-oil exports, meaning that while actuals collected was high, it would appear low when compared and collated with revenue from oil exports, which is outside the brief and control of FIRS.
In the memo, he said, in part: “ The total collection for the said period, (2012-2014), was N14,527.85 trillion, while the total actual collection between 2016 to 2018 was N12,656.30 trillion. The highlight of these collected figures was that during the period 2012 to 2014, out of the N14,527.85, oil revenue accounted for N8,321.64 trillion or 57.28 per cent, while non-oil accounted for N6,206.22 trillion or 42.72 per cent and during the later period of 2016 to 2018 out of the N12,656.30 trillion, oil revenue accounted for N5,145.87 trillion or 40.65 per cent and non-oil revenue accounted for N7,510.42 trillion or 59.35 per cent. FIRS management has control of non-oil revenue collection figures while oil revenue collection fIgures are subject to more external forces as highlighted above.
“From the above, the non-oil revenue collection grew by N1,304.20 trillion or 21 per cent within the period 2016 to 2018
“Kindly note that the total budget collection figure during 2012 to 2014 stood at N12,190. 52 trillion compared to N16,771.78 trillion for the period 2016 to 29018, which represents an increase of 37.58 per cent”
He then goes on to produce the info graphics in addition to further explanation as indicated in his memo reproduced below.
Kyari’s Memo and Fowlers’s replies,
At this point of possibly acrimony, the presidency has waded in and stated that the FIRS boss was under no investigation, but undergoing a routine public service exercise that has shed light into some grey areas in the administration’s finances.
According to Mallam Garba Shehu, Senior Special Assistant to the President, in a statement on Monday, the impression being created in the some media organisations that Fowler is undergoing investigations, is incorrect.
He said the administration’s “projected revenue falls behind recurrent expenditure even without having factored in capital expenditure.”
“Consequently,” he continues, “it would appear that the country might be heading for a fiscal crisis if urgent steps are not taken to halt the negative trends in target setting and target realization of tax revenue.
“It is noteworthy and highly commendable that under this administration, the number of taxable adults has increased from N10million to 20 million with concerted efforts still ongoing to bring a lot more into the tax net