The Senate on Thursday rejected the report by the Committee on Finance in which the N143.7bn budget of the Federal Inland Revenue Service was approved.
The lawmakers, while debating the recommendation of the committee during the day’s plenary, criticised the report as lacking details.
On the proposed 2016 budget of the FIRS, the report said, “The Federal Inland Revenue Service projected to collect tax revenues to the tune of N4.082trn in 2016.
“This comprises of N484bn oil and N3.597tn non-oil revenues. The projected four per cent Cost of Collection on non-oil revenue is N143,904,640,000.
“The total projected available fund for the 2016 budget is N146,165,108,293, comprising of four per cent Cost of Collection and N2,260,468,293 or 20 per cent of 2015 operating
The Chairman, Senate Committee on Finance, Senator John Enoh, while presenting the report to the chamber, recalled that the Senate on July 21, 2016, considered the request of President Muhammadu Buhari on the 2016 budget of the FIRS and referred same to the committee for further legislative action.
The report said, “The Federal Inland Revenue Service is one of the Federal Government Agencies established in 2007 by an Act of the National Assembly.
“The overall mandate of the FIRS is to collect taxes for the federation and enforce compliance with tax laws across the federation.
“The FIRS is funded by four per cent Cost of Collection of all non-oil and gas taxes collected by the service, which should be appropriated by the National Assembly as stipulated in Section 15 (a) of the FIRS Act 2007.
“In compliance with the FIRS Act, the service forwarded its proposed budget to the Senate’s and the House of Representatives’ Committees on Finance for consideration and approval.”
On the performance of the 2015 budget of the FIRS, the report said
National Assembly’s joint Committees on Finance approved a revenue
projection of N436tn, comprising of N1.74tn oil revenue and N262tn
The joint committee also projected the four per cent Cost of Collection of non-oil revenue by the FIRS to be N104,723,880,000.
The committee stated the summary of the proposed 2016 expenditure of the service as follows: personnel, N64,491,130,526; overhead, N46,363,000,000; and capital, N32,868,300,000, bringing the total expenditure to N143,722,430,526.
The committee, according to the report, observed that the projected non-oil revenue collection had increased from the 2015 collection, thereby increasing the four per cent Cost of Collection to the service to N143,904,640,000bn from N104,723,880,000 in 2015.
The committee further observed that, “The total personnel costs are for salaries, wages, allowances, performance bonuses and social contributions. The 8,000 (members of) staff are proposed to be on the payroll during the 2016 financial year, which accounts for the
increase of 19 per cent above actual staff strength of 6,748.
The projection presumes a recruitment of new staff in 2016.
It further observed that, “The overhead cost is very vital in driving the achievement of FIRS’ core objectives of tax revenue generation.
The provisions in 2016 budget give more emphasis on availability of office materials, training, consulting and professional services and publicity.”
The committee added that, “The capital cost estimates proposed includes ongoing projects, which are to be completed during the 2016 financial year, as well as new projects to be carried out.
“These projects include new corporate headquarters and other prototype offices, construction of new offices nationwide and ICT projects.”
The committee, therefore, recommended that a total expenditure of N143,722,430,526 be approved for the FIRS in 2016, which the Senate rejected.