FG To Deploy PPP To Boost Excise, Tax Revenue
The Federal Government is deploying an Integrated Secure Track and Trace Solution to boost revenue through excise and tax collection.
The Public-Private Partnership (PPP) solution, which will adopt the Build, Operate and Transfer option, will allow the Federal Government, through the Ministry of Finance, establish an effective and non-intrusive control on goods and services subject to excise duty, safety and standards.
The project will be operated by An International Company called SCIPA in partnership with an Indegenous company called Equinox Conformity Solutions Limited.
Minister of Finance, Budget and National Planning, Mrs Zainab Ahmed, while affirming that the project was viable, said: “The purpose of this project is to enable the ministry have visibility over a number of key products that are made in Nigeria, in terms of the quantity and companies that produce them.”
Mrs Ahmed added that the solution will “also differentiate between the same products produced in Nigeria and the ones that are imported, the bottom line is for us to be able to maximise our revenue potentials”.
She stated: “As the fiscal authority of the government, the Ministry of Finance had the responsibility to ensure that duties and taxes are paid and that the relevant agencies were assisted to make their work more seamless, hence the need to deploy the solution.”
The finance minister assured that the solution was not going to put more burden on companies as the duties to be collected were not going to disrupt manufacturing in any way.
According to her, “I am assured that the manufacturing companies’ businesses will not be disrupted, they are not going to incur any additional cost, the excise duty that will be charged will be a pass-through cost. We are convinced that this is the right thing to do.”
She expressed confidence in the solution, citing that the same infrastructure had been deployed by the same company in South Africa and Morocco to boost their revenue accruals.
“Having had several meetings with the proposing company, we thought that the best way to do this is through a Public Private Partnership (PPP) model and I am glad that the Outline Business Case (OBC) Compliance Certificate has been issued,” she said.
The Director-General, Infrastructure Concession Regulatory Commission (ICRC) Michael Ohiani, presenting the Outline Business Case (OBC) compliance certificate to the Minister, said the solution would bring about many benefits to Nigeria.
Some of these benefits include stemming illicit trade and revenue leakages, improve revenue generation for the government, ensure circulation of high-quality goods and services, achieve economies of scale and synergies amongst Ministry’s agencies, enhance technology and knowledge transfer and generate employment opportunities.
He stated: “The proposed solution when implemented will allow the Federal Government of Nigeria to establish effective and non-intrusive controls on a broad range of markets, such as goods and services subject to excise duty, and goods subject to conformity with health, safety and quality standards.’’
“Additionally, the solution aims to reduce the levels of counterfeiting, sub-standard quality, tax evasion and under-declaration in these markets,” Ohiani said.
Ohiani pointed out that the ICRC and the Ministry will now proceed to the procurement stage after which a Full Business Case (FBC) Compliance Certificate will be issued for onward submission to the Federal Executive Council (FEC) for project approval.