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CSOs Kick Against Proposed Social Media Tax
Civil Society Organisations last Monday condemned the Federal Inland Revenue Service over its decision to impose taxes on social media activities.
The FIRS is currently seeking the approval of the National Assembly to further amend the Finance Act for the purpose of dragging online businesses on the social media to its tax net.
The chairman of the agency, Muhammad Nami, stated this during an ongoing engagement between the Senate Joint Committees working on the Medium Term Expenditure Framework and Fiscal Strategy Paper, and heads of revenue generating agencies of the Federal Government.
Nami said apart from targeting the social media businesses, the proposed amendments to the Finance Act would also affect the Stamp Duty Act because some of the provisions were already obsolete.
He said: “You are aware of the issues of digital economy and the challenges of policing the digital tax payers like Twitters and Facebook.
“So, we are going to come up with the rules and provisions that the National Assembly will passionately look at and approve for us so as to bring them to the tax net.
“We want to see a way of taxing online activities and businesses.”
But reacting to the proposal, the Executive Director, Civil Society Legislative Advocacy Centre, Auwal Rafsanjani, cautioned the revenue agency against doing anything that would affect the businesses of young Nigerians who were struggling to survive.
Rafsanjani said: “There are many avenues which the FIRS can explore in order to generate income.
“The agency should not impose additional burden on young Nigerians who are just struggling to survive and making use of the social media to transact their businesses.
“The FIRS should concentrate on taxing the companies that are making profits from adverts and not individuals that subscribe to those social media platforms.
“Individuals who subscribe to those platforms and showcasing their businesses there should not be taxed. The tax should be on corporate entities that are making profits.”
Also, the founding Director of Women Advocates Research and Documentation Centre,
DrAbiolaAkiyode-Afolabi, described the move as another plot to shut the social media against the people.
Akiyode-Afolabi said: “The government can’t make money on everything when it’s not giving people back.
“While taxation in theory is progressive, Nigeria should follow best practices.
“This is another attempt to shut down the space against the people. This attempt should be resisted; the government should focus on providing good governance for her people, not targeting people for more hardship and exploitation.”
However, the Executive Director, Centre for Public Accountability, Olufemi Lawson, noted that all Nigerians doing businesses in whatever form must pay tax.
He said: “I think the FIRS must ensure that all persons, and businesses in Nigeria must pay this tax, as far as it is legally backed by the needed legislation.”
Nami told the senators that the Finance Bill was supposed to accompany the annual budget.
He said the agency would review feedbacks from tax payers and its internal operations so as to fix the loopholes in the tax law.
He said: “The Stamp Duty Act came into being in 1962 and the figures in that Act are obsolete.
“For instance, some of dutiable instruments which are about 100 are in the region of 10 kobo or 15 kobo. In the real time, it cannot give us any significant revenue and we would not be able to generate additional revenue for government.
“If for instance we are spending N5 to print an adhesive stamp when the tax it would be used to administer is 15 kobo, I think there would be no need for us to collect that tax in the first place.
“These and more are some of the things that we have identified so that in line with the way business processes are changing, we have to adjust the law to make tax payment simple and enable us to block leakages and mobilise revenue for the three tiers of government”.
“We are not really increasing or reducing some of the rates but to change the figures to reflect the current reality.”
The Chairman of the Senate Committee on Finance, who is also coordinating the joints panels of the red chamber working on the MTEF/FSP, Senator Solomon Adeola, said the proposal would assist the FIRS to meet its revenue projection of N10tn in 2022.
The Managing Director, Shell Nigeria Exploration and Company Limited (SNEPCo), Elohor Aiboni, said Bonga, Nigeria’s first deep-water asset, has recorded major milestones, due to effective leadership, cutting-edge technology, continuous improvement and collaboration with stakeholders.
She noted that since coming on stream in November 2005, Bonga has maintained a track record of production that saw it achieve one-billion-barrel export on February 13, last year.
In her presentation, titled “The Bonga Journey to a Billion Barrels”, at the ongoing 2024 Offshore Technology Conference in Houston, Texas, United States, Aiboni, said: “SNEPCo is grateful for the contributions of all the parties to the Bonga story and we can all be proud of the milestones.
“Bonga has been consistent. In 2014, nine years after coming onstream, it achieved half a billion barrels of crude and doubled it in 2023. We have worked relentlessly to ensure excellent asset management, project and wells delivery and deployment of technology and innovations in our operations”.
According to her, these factors, “coupled with the supportive partnership of the Nigerian National Petroleum Company Limited and our co-venturers – TotalEnergies, EP Nigeria Limited; Nigerian Agip Exploration; and Esso Exploration and Production Nigeria Limited, make Bonga stand out as a world-class investment case”.
She continued that, “SNEPCo also enjoyed the support of the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) and the Nigerian Content Development and Monitoring Board (NCDMB) in the success of Bonga operations”.
Aiboni also listed the challenges of keeping the Bonga Floating Production, Storage and Offloading vessel full as the asset ages and dealing with unexpected developments with subsea wells and equipment.
She said: “SNEPCo responded with a campaign of operational excellence, which among other initiatives, led to the creation of a programme known as the Bonga Business Improvement Plan that continually reviews and identifies improvement initiatives and drives sustainability in operations and upskilling of staff.
“The Bonga success story has been led by Nigerians who have been managing directors of SNEPCo since it was established in 1993, in a deliberate policy by Shell to develop indigenous manpower for deep-water operations in Nigeria.
“Today, some 97percent of the SNEPCo workforce is Nigerian and overall, Bonga has helped to create a new generation of Nigerian deep-water professionals.
“Our vision at SNEPCo remains to be the best deep-water business, powering growth and achieving net zero emissions in line with Shell’s Powering Progress strategy”.
Banks’ borrowings from the Central Bank of Nigeria (CBN) fell month-on-month, (MoM) by 44 percent to N12.16 trillion in April from N21.7 trillion in March.
Analysis of latest data from the CBN shows that the 44percent drop represents the first MoM decline in banks borrowing from since January when it increased by 268.7 percent to N3.6 trillion from N976.29 billion in December 2023.
However, further analysis showed that banks’ deposits in the CBN SDF grew MoM by 118.4 percent to N428.97 billion in April from N196.37 billion in March 2024.
Banks make use of the SLF to access liquidity to run their day-to-day business operations while the Standing Deposit Facility window (SDF) on the other hand, is an overnight deposit facility that allows banks to lodge excess liquidity (money) with the CBN and earn interest.
The decline in banks’ borrowing from SLF may reflect an increase in banking system liquidity and also the decision of the apex bank last year to remove the limit on the remunerable daily placements by banks at the SDF.
According to the CBN Governor, Mr. Olayemi Cardoso, the CBN removed the cap on the remunerable SDF to increase activity in the SDF window and manage liquidity.
A Financial technology expert, Olatunji Akinrinola, has highlighted the exponential growth of the FinTech industry, which according to him, was driven by technological advancements.
Akinrinola made this assertion in a press release recently, where he stressed that the role of technology in driving this exponential growth in the FinTech sector was very outstanding.
According to him, Technology has revolutionised the way financial services are delivered, making them more accessible, efficient, and inclusive.
“Through innovations such as mobile banking, digital payments, and blockchain technology, FinTech companies have been able to reach a larger population and provided them with access to financial services”, he stated.
Akinrinola emphasised the role of technology in enabling financial inclusion, adding: “Technology has democratised access to financial services, particularly in regions with limited banking infrastructure.
“Mobile money platforms and digital wallets have empowered individuals to conduct financial transactions conveniently and securely, without the need for traditional banking services”.
He also underscored the role of Artificial Intelligence (AI) and data analytics in driving innovation within the FinTech industry, noting: “AI-powered algorithms and predictive analytics have revolutionised risk assessment, fraud detection, and customer personalisation in financial services.
“These technologies enable FinTech companies to provide tailored solutions and mitigate risks more effectively, ultimately enhancing the overall customer experience”.
Akinrinola stressed the importance of regulatory frameworks in fostering the growth of the FinTech industry.
“While technology has accelerated the growth of FinTech, it is essential to establish robust regulatory frameworks to ensure consumer protection and maintain market stability. Regulators play a crucial role in balancing innovation with risk management, thereby creating a conducive environment for the sustainable growth of the FinTech sector”, he stated.
Akinrinola underscored the role of technology in driving the exponential growth of the FinTech industry, saying, “Technology has been a game-changer for the FinTech sector, enabling innovation, expanding access to financial services, and driving economic growth.
“As technology continues to evolve, the FinTech industry will undoubtedly play a significant role in shaping the future of financial services ecosystem”.
Corlins Walter