Nigeria: Tax - Why FIRS Boss Fowler Was Queried

19 August 2019

Hamza Idris & Latifat Opoola — The Executive Chairman of the Federal Inland Revenue Service (FIRS), Mr. Babatunde Fowler, was queried by President Muhammadu Buhari over variances between budgeted collections and actual collections between 2015 and 2018.

Multiple presidency sources confirmed the authenticity of the query dated August 8, 2019, and signed by the Chief of Staff to the President, Malam Abba Kyari.

"We have observed significant variances between the budgeted collections and actual collections for the period 2015 to 2018. Accordingly, you are kindly invited to submit a comprehensive variance analysis explaining the reasons for the variances between budgeted and actual collections for each main tax item for each of the years 2015to 2018.

"Furthermore, we observe that the actual collections 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 was asked to respond by August 19, 2019 (today).

Daily Trust reports that the FIRS boss was appointed by President Buhari on August 18, 2015. His appointment was confirmed by the Senate on Wednesday, December 9 of the same year.

But one of the sources expressed shock as to how the query was leaked to the press, blaming "Fowler's enemies" in the system.

The source, who does not want to be named, said: "We don't know how the letter got to the press. Maybe people who don't like the chairman leaked it. But it is true that the letter was indeed written by the Chief of Staff on behalf of the President.

"As you have seen from the content, it is not a query per se. It is just a request for explanation. The request is itself based on the information supplied to the Presidency by the chairman (Fowler) himself," he said.

He said Fowler was asked to come forward with the revenue collection over a ten -year period.

"From 2010 to 2014, the FIRS surpassed its targets for each year. From 2015 to date, the FIRS failed to meet its targets every year. So, the idea of the letter is for him to explain the situation as raised by the records he presented. It's for him to speak, not the Presidency," the source said.

Another source, who also confirmed the query, said the response of the FIRS boss was being expected today.

"You know President Buhari is all out to leave behind a legacy at the end of his tenure come 2023 and he needs funds to execute his programmes and policies. It is against this backdrop that the FIRS boss was queried," the source said, saying he should not be named.

Daily Trust reports that the query is being seen as a signal that Fowler's tenure may not be renewed.

Dwindling revenue

In the years under review, the actual amount collected under Fowler as tax fell below the budgeted target and also low when compared with what was received before he became the chief executive of FIRS.

In 2015, the actual collection was put at N3.7tn, while the budgeted target was N4.5tn. A similar shortfall occurred in 2016, when actual collection was N3.307tn, less than the N4.95tn budgeted target.

Also, in 2017, the FIRS collected a total of N4.027tn, less than the set target of N4.89tn. In 2018, actual collection was N5.32tn, while the budgeted target was N6.7tn.

The FIRS is responsible for assessing, collecting and accounting for tax and other revenues accruing to the Federal Government. In 2007, FIRS got financial and administrative autonomy with the passage of the Federal Inland Revenue Service (establishment) Act 2007.

Too many petitions

A staff of the FIRS told the Daily Trust last night that there were so many petitions against Fowler.

The staff, who spoke on condition of anonymity, said he also saw the query issued by the presidency.

"Though I cannot confirm its authenticity, I know very well that there are many petitions against Mr Fowler written by both insiders and people watching happenings in the establishment from outside," he said.

"However, if the query circulating in the social media is true, I want to believe that the presidency only touched on one aspect. There is heightened grumbling within FIRS on staff welfare and entitlements.

"There is also disaffection about budgeted allowances for staff that supposed to go on training but only privileged few are allowed to go over the years.

"Many of us have been listed for certain mandatory trainings over the years but were not granted permission to go. And most importantly, though many FIRS offices have been opened across the country, they are not operating optimally," he said.

The 63-year old Fowler, who is a tax administrator, had served as the Executive Chairman Lagos State Board of Internal Revenue.

Efforts to get reaction from the Head of Communications and Servicom Department, Wahab Gadamosi, were not successful as his phone lines were not reachable up to the time of filing this report.

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