FG's Plan: Collecting VAT from Market Traders and Informal Sector

FIRS and MATAN Collaboration: Uniting for Effective Tax Collection

Under the VAT Direct Initiative, the FIRS has forged a strategic partnership with MATAN, the largest player in Nigeria's informal market space, boasting a membership of over 40 million traders. The collaboration between the FIRS and MATAN is poised to revolutionize VAT collection and remittance by promoting awareness, simplifying processes, and leveraging digital platforms tailored to the specific needs of the marketplace and informal sector.

The VAT Direct Initiative signifies the first-of-its-kind collaboration between the FIRS and MATAN, which harnesses technology to enhance VAT collection and remittance. MATAN has developed a purpose-built digital platform that plays a pivotal role in this initiative. Through this platform, MATAN enumerates its members, providing them with a digital ID card that includes their Tax Identification Number (TIN) and other pertinent details. This digital infrastructure facilitates efficient tracking of turnovers, ensuring that VAT obligations are accurately assessed and promptly collected and remitted to the FIRS.

Curbing Multiple Taxations and Enhancing Revenue Generation

The FIRS recognizes the adverse effects of multiple taxations on the marketplace and the informal sector, often perpetuated by touts and self-imposed tax collectors. To address this challenge, the VAT Direct Initiative includes collaborative efforts with security agencies to curtail the activities of these unauthorized tax collectors. By combatting multiple taxations and optimizing VAT collection, the government aims to bolster revenue generation, benefiting all three tiers of government. Increased revenue will subsequently be channeled towards crucial infrastructure development and the provision of essential social amenities.

With the implementation of the VAT Direct Initiative, the Nigerian Government, in partnership with MATAN, is taking significant strides towards improving tax collection efficiency and reducing multiple taxations in the informal sector. This innovative collaboration harnesses technology and establishes a purpose-built digital platform to streamline VAT payment and remittance processes for market traders and participants in the informal economy. By fostering collaboration, leveraging digital solutions, and curbing unauthorized tax collection activities, the government aims to boost revenue generation, ultimately leading to increased funding for infrastructure development and the provision of essential social amenities. Through the VAT Direct Initiative, Nigeria paves the way for more effective and inclusive taxation systems, contributing to the overall economic growth and development of the nation.