The Federal Inland Revenue Service (FIRS) and the Lagos Internal Revenue Service (LIRS), on Wednesday, signed a Memorandum of Understanding (MoU) to establish a joint audit and investigation team.
The move was aimed at encouraging the exchange of information between both the tax authorities.
The agreement also seeks to improve tax administration by reducing tax compliance cost thereby enabling ease of doing business in the country.
Executive Chairman of FIRS, Mr. Muhammad Nami and Executive Chairman, LIRS, Ayodele Subair, in the communique, charged the public, taxpayers and tax practitioners to provide full support and cooperation to both tax regulators for the overall economic benefit of all stakeholders.
Nami, said the cooperation would enable the two authorities to work as a team in sharing relevant information that would assist both parties in their tax administration and enforcement roles as it would also provide capacity building between them.
He said, “We will carry out a joint audit and investigation as a team, we will also conduct an automatic exchange of information for gathering data for the purpose of tax administration. With that information, we would be able to carry out tax administration seamlessly.”
On his part, Subair, said the agreement would foster greater collaboration between the two agencies, adding that “There is no reason to debate the above as it has been established that tax compliance and good governance are expected to co-exist as the undividable social contract that binds citizens and governments anywhere in the world. Therefore, citizens and governments are expected to fulfil their end of the bargain in achieving a balance.”
Essentially, the collaboration in the area of exchange of information would ensure efficiency, accurate assessments and increased revenue for funding of government expenditure, according to the communique.
The partnership would leverage existing distinct competencies in tax administration between both parties to collaborate in the areas of exchange of information, harmonisation of an integrated tax system and joint tax audit or investigation exercise, where necessary, in carrying out their respective mandates for the purpose of optimising tax revenue to the federal government and the state government.
Moreover, the collaboration was expected to improve tax administration with a view to enhancing tax revenue generation, creation of a robust database and improve on the country’s tax-to-GDP ratio.
The parties are expected to establish a joint audit or investigation team to be known as the FIRS/LSBIR JAIT whose membership shall be determined by both parties to conduct a joint audit or investigation exercise which shall be concluded timeously.
The communique assured the public that employees of both parties will abide by the code of conduct and ethical compliance to assure that the implementation of the MoU does not impact negatively on the taxpayers and the parties.
James Emejo
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