President Muhammadu Buhari has nominated Muhammad Nami as the new Chairman of the Federal Inland Revenue Service (FIRS), Nigeria. Mr. Nami would take over where the out-gone Chairman Babatunde Fowler stopped. Personally, I see the chairmanship of FIRS as critical as a federal ministerial position because of the impact  of the agency on the structure, format and architecture of the nation’s economy, arising from tax policies.

FIRS is going to drive tax revenue that would be needed to fund our national budget. Across all metrics, we have not been very lucky in that domain as Nigeria’s tax collection efficiency is severely underwhelming. From the less than 35 million payers, out of possible 100 million citizens, to recent plans to tax “revenue” instead of profits in digital companies, we have real paralyses to deal with. The new VAT rate coming in 2020 is something that could move some segments of the economy to move informal, in order to reduce tax exposure.

For Mr. Nami once Senate confirms him, his desk would be busy. As he begins to deal with the issues, here are two areas he has to pay attention:

Pursue TAX Policy for Economic Growth: In recent years, Nigeria has focused on tax collection with nothing done on how tax policy can engineer growth in the economy. I have shared some ideas on how a new tax policy can boost investment.

Government should offer new VC (venture capital) firms in Nigeria a ten year tax incentive on profits if they have asset base of at least $50 million and will deploy the capital in Nigerian startups within 10 years. Offer new VC firms in Nigeria the opportunity to repatriate 100% of profit within ten years. That will help the country to attract foreign investors to make Nigeria home. If we have this type of incentive, we will see many VC funds making Nigeria home to explore opportunities in Nigeria and continental Africa. That influx of capital will have many multiples of benefits to our economy, our people, and the Nigerian technology space. Most especially our tech firms will stay home instead of changing jurisdictions to U.S. or Europe..

Push for Tax Reforms to make donations to schools tax-deductible, not treated as expenses. This is one way to bring more funds into the school system, from primary to university levels. Largely, when companies donate money to universities to work on things that matter to them, they could use the donations to reduce their tax exposures. Typically, providing that structure would stimulate more entities to give to schools.

If Company A wants to start a factory in Owerri Nigeria and needs to train 1000 people in the areas it does business. It can ask Federal University of Technology Owerri to do that training, providing the manuals and documents required. It will fund it say with $3 million for three years. FUTO may integrate the program in its curricula (NUC may need to approve). FUTO has received funding, expanded its program and at the same time graduating students that will likely have jobs when they finish. Brilliant!

For Company A, it has moved the non-core training out to focus on its business, knowing that whenever it wants talent, FUTO is preparing them. Then on that $3 million, Nigerian government allows it to deduct it, non taxable. Simply, the revenue where that money has come will not be taxed because it has been used to do good to the society. Just like that, the company has saved money and at the same time assisted FUTO to deepen its programs. That is an incentive which does not exist right now, and Nigeria needs to update our tax system to make it possible.

Today, what is possible is to deduct that $3 million as an expense, meaning that it is recognized in the tax book as pure business. That is not enough as the resulting balance will be taxed accordingly. In U.S. that $3 million is treated differently, offsetting not just its expense but other areas the company might have experienced losses. So magically, you use donation to make-up. That is why giving is financially good, under some circumstances, for both the recipients and the givers.

PRESIDENT BUHARI NAMES NEW FIRS BOARD FOR SENATE CONFIRMATION

President Muhammadu Buhari has approved the composition of a new board for the Federal Inland Revenue Service, FIRS, subject to Senate confirmation.

The President nominated a renowned tax consultant, Muhammad M. Nami as the new chairman.

The board is composed of a member representing each of the six geographical zones and statutory representatives from a select number of ministries and government agencies.

Mr Muhammad, a well-trained Tax, Accounting and Management professional with highly rated qualifications and professional practice and licenses from relevant professional bodies, has almost three decades of practical working experience in Auditing, Tax Management and Advisory and Management services to clients in the banking, manufacturing, services and public sectors as well as non- profit organizations.

He is an expert in rendering advisory support services to investors in respect of new business start-ups and management of existing businesses. He has also continuously rendered outsourced services to clients in trading, service and manufacturing sectors of the nation’s economy.

Muhammad Nami attended Bayero University Kano and Ahmadu Bello University, Zaria where he obtained a Bachelor’s Degree in Sociology (1991) and a Masters of Business degree (2004) respectively. He is a fellow of Chartered Institute of Taxation of Nigeria, Institute of Debt Recovery Practitioners of Nigeria and Associate Member of Nigerian Institute of Management (Chartered) and Association of National Accountants of Nigeria.

He started his career with PFK in 1993 and rose to the position of a senior Consultant in charge of Tax management and advisory services. He is currently the managing consultant of Manam Professional Services (Chartered Tax Practitioners and Business Advisers) based in Kaduna, Abuja, Niger State.

Mr Muhammad has served, and is still serving, on many companies’ Board and Statutory Board Audit Committees. He was appointed as a member, Presidential Committee on Audit of Recovered Stolen Assets in November, 2017 by President Buhari.

He is married with children.

Chairman of FIRS, Babatunde Fowler, whose term of office expired on Monday, 9th December, 2019 is expected to hand over to the most senior director on the board, who will take charge, pending the senate confirmation of the new board.

Nigeria’s Lost Taxes to Mauritius

Last week, at the Nigerian Council of Registered Insurance Brokers (NCRIB) 16th AGM/2019 End of year Lecture and Award Night, Wragby launched an Insurance Brokerage Business Management Solution called iBroka. This solution has been specifically built to optimize the services being provided by the over 600 Insurance brokerage firms in Nigeria.

Over the past 6 months, Wragby team has worked tirelessly with the NCRIB team to fully understand their processes and build an automated solution that is tailored to their needs while also being affordable (they can subscribe for as low as N3,000/month for a 3-user bundle).

The Subscription based application has been developed as an easy to setup and manage solution, so insurance Brokers require little or no IT support in setting up and using the application to manage their businesses.

The solution is subscription-based and hosted in the Cloud, hence customers do not have to worry about IT Hardware acquisition. While billing is monthly, customers can pay monthly or annually (annual subscription attracts a 2 months discount). 

According to the Executive Director of Wragby Business Solutions & Technologies, Dr. Yomi Alarape, “iBroka is a fully integrated cloud based solution which allows Insurance Brokers to manage their typical business operations, Brokerage Services, Accounting, Talent Management and very importantly, meet Business & Regulatory reporting. With as Low as N3,000 naira a month, Insurance brokerage firms can subscribe to this application online and have access to business solutions from anywhere in the world via any digital device, at this URL: www.ibrokang.com”

Besides iBroka, Wragby has the following solutions for the market:

1. wBizmanager: An ERP built specifically for Small Businesses (SMBs).
2. SMEProductivity: A cloud Marketplace that allows Small Businesses (SMBs) subscribe to IT productivity and collaboration tools (including Microsoft Office 365 for Business). 
3. API Management & Monetization: An Enterprise Solution (targeted at FSI & Telcos) that enables Organizations publish APIs to external partners (for a fee), and internal developers, so as to unlock the potential of their data and services.

Wragby is a team of acclaimed world-class professionals relentlessly obsessed with the consistent delivery of trail-blazing solutions that guarantee their customers optimum productivity.

Wragby has a pedigree of firsts, and remains at the forefront of technological innovations, enabling their customers to efficiently adapt to rapid changes while going the last-mile to support their delivery of superior business processes and outcomes. Wragby is your anxiety-free IT partner. 

For more information please contact Wragby at www.wragbysolutions.com or send an email to info@wragbysolutions.com

Cars45 provides an end-to-end digitised customer journey for buying, selling and swapping cars in Africa. Its technology-enabled platform makes it easier to trade cars in Africa and it also provides access to finance, insurance and other value-added services.

Cars45 is building the infrastructure that allows sellers and buyers of cars across the continent to exchange value quickly, cheaply and with unhindered access to independent, relevant information required for decision making. It also has retail outlets at strategic locations to make it easier for customers to trade securely and with peace of mind. Its parent company recently raised a lot of money.

Now, the Nigeria’s leading automotive trading platform has launched into Ghana (www.cars45.com.gh)  and Kenya (www.cars45.co.ke). Cars45 is aiming to become the primary platform for all car transactions in the $45 billion African used car market and expansion into these strategic markets marks an important step on that journey.

In an African market where 9 million used cars are traded annually, trust is often a rare commodity as buyers and sellers navigate opaque pricing and quality assurance structures. Using its technology-enabled platform, consumers in Ghana and Kenya can now sell their cars directly through Cars45 and get paid in 45 minutes. Sellers have access to standardised pricing and a transparent marketplace, with 100 percent visibility into price offers, and buyers get access to the largest selection of verified cars. Cars45 will also provide vehicle financing, background checks, vehicle history, insurance, after-sales support, servicing and other ancillary services that consumers will need in their automotive lifecycle.

With retail locations already opened in Nairobi and Accra, Cars45 plans to increase its footprint in Ghana and Kenya even further by opening more centres in Mombasa, Tema, Kumasi and other cities. Cars45 also aims to expand into additional African markets in 2020.

In addition to its launch into these markets, Cars45 is also launching a consumer-to-consumer marketplace that directly matches sellers and buyers across all markets it operates in. In an African automotive market where trust is not traditionally high, consumers will be able to connect in a seamless and secure way, using Cars45 as a marker of professionalism and excellence.

All cars listed in the Cars45 marketplace have been through a thorough vetting process (200 point inspection, due diligence and background check) and will carry the trusted Cars45 inspection report. Cars45 will also conduct multi-level screening to ensure that only serious buyers are brought forward. Buyers will have full confidence in the purchase they are making and sellers will be protected by an escrow model. 

According to Etop Ikpe, CEO and co-founder of Cars45, “We want to connect buyers and sellers across the continent in the most seamless way, taking the stress out of the trading experience. After successfully establishing ourselves in Nigeria, expanding into Ghana and Kenya made perfect sense as the ideal next step as we build a transparent and fair structure for trading cars on the continent.

Ikpe added that “the process of buying and selling cars today can be complicated, time-consuming and needlessly expensive. We want to put an end to that by providing an easy and convenient way for consumers across Africa to make what is often the most significant financial transaction of their lives.”