FIRS Unveils New Tax Structure, Exempts Skit Makers from Taxation

A Federal Inland Revenue Service (FIRS) official has clarified that companies earning less than N25 million are not required to pay tax, offering a relief to small businesses across Nigeria. The official, who spoke on the condition of anonymity, emphasized that FIRS does not tax personal income but rather focuses on collecting company income tax. Only corporate entities earning a profit of N25 million or more fall within the tax bracket.

In a further statement, the official reassured that FIRS has no intention to tax online content creators, particularly skit makers, as they are individuals outside the scope of the agency’s tax regulations. This clarification provides clarity to individuals in the digital content creation space, alleviating concerns about potential tax obligations.

Recently, FIRS unveiled a new tax administration structure aimed at enhancing efficiency and modernizing tax practices in Nigeria. FIRS Executive Chairman, Zacch Adedeji, highlighted the agency’s commitment to embracing an integrated tax approach, utilizing technology to improve taxpayer services and streamline operations.

Adedeji explained, “This approach positions FIRS at the forefront of innovation, ensuring that we meet the evolving needs of our taxpayers in a rapidly changing world.” The new structure consolidates core functions and support services, simplifying the taxpayer experience and eliminating complexities in tax administration.

The FIRS’s move to exempt small businesses and online content creators from tax obligations has received mixed reactions. While some applaud the relief provided to smaller companies, others question the criteria used to determine the N25 million threshold for tax exemption. Critics argue that the threshold may not adequately reflect the economic realities faced by businesses, particularly in the current economic climate.

Despite the controversy, FIRS remains committed to its new tax structure, aiming to provide a more user-friendly and efficient tax administration system for all taxpayers. The agency’s focus on innovation and technology reflects its dedication to improving tax compliance and enhancing the overall tax experience for businesses and individuals alike.

The Nigerian Lawyer News