The Lagos Internal Revenue Service (LIRS) and the Federal Inland Revenue Service (FIRS) have entered into a Memorandum of Understanding (MoU) to establish a Joint FIRS and LIRS Audit and Investigation Team aimed at encouraging the exchange of information between both agencies.
In the communique signed by Ayodele Subair, Executive Chairman, LIRS, and Muhammad Nami, Executive Chairman, FIRS on Wednesday, the general public, taxpayers and tax practitioners are charged to provide full support and cooperation to both Agencies for the overall economic beneﬁt of all stakeholders.
According to the MoU, the overall objective of the Joint Tax Audit would be to improve tax administration by reducing tax compliance cost thereby enabling ease of doing business in the country.
Speaking on the MoU, Mr Ayodele Subair, Executive Chairman, LIRS, said while the importance of the agreement was to foster greater collaboration between the two agencies, “There is no reason to debate the above as it has been established that tax compliance and good governance are expected to co-exist as the undividable social contract that binds citizens and governments anywhere in the world. Therefore, citizens and governments are expected to fulfil their end of the bargain in achieving a balance.”
According to the FIRS Executive Chairman, Muhammad Nami, ‘’The cooperation would enable the two authorities to work as a team in sharing relevant information that would assist both parties in their tax administration and enforcement roles as it would also provide capacity building between both tax authorities.
“We will carry out a joint audit and investigation as a team, we will also conduct an automatic exchange of information for gathering data for the purpose of tax administration. With that information, we would be able to carry out tax administration seamlessly,” he submitted.
The communique says while the notice was issued for the information and guidance of the general public, taxpayers and tax practitioners in line with the memorandum of understanding, the collaboration between both Agencies in the area of exchange of information will ensure efficiency, accurate assessments and increased revenue for funding of Government expenditure,
FIRS and LIRS, the communique says further, are leveraging on their existing distinct competencies in tax administration to collaborate in the areas of exchange of information, harmonization of an integrated tax system and joint tax audit or investigation exercise (where necessary) in carrying out their respective mandates for the purpose of optimizing tax revenue to the Federal Government and the Lagos State Government respectively.
The collaboration is expected to improve tax administration with a view to enhancing tax revenue generation, creation of a robust database and improve on the country’s tax-to-GDP ratio.
The parties (FIRS and LIRS) are expected to establish a Joint Audit or Investigation Team to be known as the FIRS/LSBIR JAIT (hereinafter referred to as “JAIT”), whose membership shall be determined by both parties to conduct a joint audit or investigation exercise which shall be concluded timeously.
The communique assured the public that employees of both parties will abide by the Code of Conduct and Ethical compliance to assure that the implementation of the MOU does not impact negatively on the taxpayers and the parties.