The Lagos Internal Revenue Service (LIRS) and the Federal Inland Revenue Service (FIRS) have signed 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.
Executive chairman of LIRS, Ayodele Subair, and executive chairman of FIRS, Muhammad Nami, in a communiqué signed on Wednesday, urged the general public, taxpayers and tax practitioners 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 costs thereby enabling ease of doing business in the country.
Speaking on the MoU, Subair 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 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 added.
The communiqué stated that 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,
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 communiqué 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 negatively affect taxpayers and the parties.
