Appraising Kwara's New Revenue Model

Date: 2015-10-18

Like every other states of the federation, Kwara State is also having its fair share of the slide in revenue accruing to it on a monthly basis. It will be noted here that, the monthly federal allocation that comes to Kwara has reduced to N1.4 billion from N2.2 billion. Whereas, the monthly wage bill of the state is said to be fluctuating between N2.7 billion and N2.8 billion.

Given the reality of the present day where the country's financial earnings from the sales of crude oil has depleted due to a sustained decline in world oil price, expanding the internally generated revenue (IGR) base of a state is one big deal that must be taken seriously to ensure the proper and effective running of the state. It is paramount for states to generate more funds to do more projects.

It is on this premise that, the present administration in Kwara state under Governor Abdulfatah Ahmed had evolved all kinds of moves to garner more revenue through payment of taxes, rates and dues from the people so as to provide basic things of life to the good people of the state and also to pay the civil servants as and when due.

Upon assumption of office, the administration in June, 2015, fashioned out a bill to the State House of Assembly that will establish Kwara State Internal Revenue Service (KWIRS) and in the twinkle of an eye, the state lawmakers passed the bill into law so as to assist the state government to commence work in earnest for the collection of all forms of taxes, rates and dues meant to add values to the socio economic advancement of the rural populace.

After, the bill on revenue had been passed into law, Ahmed went ahead to sign the bill establishing the Kwara State Internal Revenue Service (KWIRS).

Speaking during the signing of the bill into law in Ilorin recently, the governor said the law empowered the agency to collect and manage revenue on behalf of the state government and its local councils.

According to him, "This is in a bid to tackle the current financial crisis rocking the state and to ease the challenge faced by it in meeting its obligations to the people of Kwara, just as it would also reduce dependence on federal allocation, which has suffered drastic reductions following the sustained fall in crude oil prices in the global market".

Incidentally, the new development has since generated growing concerns among people of the state, with many saying that the new move by their government was aimed at increasing taxes on individuals and businesses in the state.

The governor has, however, allayed fears of the agency imposing stealth taxes on individuals and businesses, saying that it was primarily set up to ensure efficiency in revenue collection and management.F

"The Kwara State Internal Revenue Service will not impose fresh taxes on individuals and businesses in the state. The agency is only authorised to assess and enforce payment of due taxes, levies, fees and charges in the state. KWIRS will make revenue collection and management more efficient," Ahmed noted.

Moreover, in order to achieve maximum results, the state government had invited some state revenue services from Lagos and Ogun states so at intimate the officials of the KWIRS on how they would be carrying out their day-to -day operations in the state.

The affected invitees shared their experience in revenue collection and management with the officials of KWIRS knowingfully that experience they say is the best teacher.

At the meeting, THISDAY checks revealed, the officials of LIRS and OIRS shared the scope of their operations with their KWIRS counterparts.

It was gathered that, they also talked about what they have been doing right that has helped revenue collection and tax administration in their respective states. KWIRS is expected to adopt e-payment for revenue collection as no cash payment will be allowed.

With the mandate to expand the IGR base of Kwara State, KWIRS has been given a target by the state government to generate around N2 billion for the state every month, as against the monthly average of N700 million the state currently generates, thereby making the state less reliant on allocations from the federal government.

Asides its primary function of collection and management of revenue, the agency is also expected to promote policies and actions that will check and block all revenue leakages, as it will carry out constant checks and balances on finances of the various ministries, departments and agencies in the state.

However, since the setting up of KWIRS, Governor Ahmed has been meeting with various stakeholders in the state to solicit their collaboration and support for the state renewed IGR drive.

The first set of people he met were the chairmen of local government councils in the state.

There are sixteen local councils in Kwara, and the largest of this council generates N200, 000 as its monthly revenue.

Instructively, the governor charged the council chairmen on the need for them to increase revenue generation in their respective councils.

Also, Ahmed held meeting with the directors of finance and supplies (DFS) in all ministries within the state. The DFS are the controller of finance in their respective ministries. At the meeting, the governor told them to brace up for the new challenges and work together with the state revenue agency in meeting its targets.

He also underscored the importance of civil servants to key into the new scheme of tax administration in the state. There are about 20, 000 civil servants in Kwara State.

The governor had also met with the heads and bursars of the state-owned tertiary institutions. These institutions are considered to be potentially huge revenue generating agencies.

He noted that with improved IGR, the state government will be able to further meet its obligations to the people, put food on their table, and make Kwara a better place to live and invest in.

Ahmed directed all the nine state-owned tertiary institutions to open a single revenue accounts for fees and other payments in a pilot exercise that have been extended to all revenue generating agencies in the state.

They were also instructed to close all other revenue accounts maintained in commercial banks across the state. There is no denying the fact that this would definitely enable the government to monitor the management of the institutions' finances.

Ahmed called on banks to key into the government's new revenue drive and avoid any actions capable of contravening the new revenue law, saying the government will not hesitate to review its relationship with any commercial bank that attempts to sabotage the law.

The governor also met with the royal fathers on the new revenue policy of the state government.

Ahmed while speaking at the presentation of staff of office to the Oloota of Odo-Owa, Oba Joshua Oluwatoba Adeyemi in Odo-Owo in Oke-Ero local government area of the State, described traditional rulers as symbols of an institution that once thrived on taxation.

While urging them to help in mobilising their people in fulfilling their civil obligation of paying taxes, governor Ahmed noted that it was important that key stakeholders like the traditional institution assisted the state revenue generating agency in ensuring that the people of the state comply with the increased revenue generation drive by paying taxes.

Commenting on the new revenue drive of the state government, the Senior Special Assistant on Media and Communications to the Governor Ahmed, Dr. Muyideen Akorede, stated that it had been a success, just as he commended the institutions for their cooperation so far.

He also expressed optimism that the state government would achieve bigger success in its effort to expand its revenue and economic base, which according to him will put the administration of Governor Ahmed in a stronger position to drive the laudable aspirations he has in mind for Kwara State.

He also stressed that the government alone could not meet the yearnings of the people, bt it will, however, provide platforms that support private initiatives to thrive and provide employment opportunities for the teeming youth of the State.

On the need for effective tax education and public enlightenment, Dr. Akorede has hinted that different platforms such as drama, social media campaigns, radio jingles, billboards and the rest shall be explored to sensitise the populace.

The SSA explained that the newly-established revenue board will make tax assessment and payment convenient for tax payers, and will consider alternatives for revenue generation.

"In his inaugural speech, the governor showed a clear direction of what his administration will do for the next four years and within 100 days in office, he was able to set up a strong framework for generating revenue for the state and stimulate the economy of the state from several angles through infrastructure development, human development and agriculture.

"The Kwara of 2019 by God's grace will not have any resemblance with what we are witnessing now in terms of development," he explained .

Akorede also called on the people of the state to support the government renewed IGR drive, stressing that it would insulate the state from financial crisis and assist the government to further meet its obligations to the people.

By and large, with the new revenue generation regime in the state, there is going to be more delivery of dividends of democracy to the rural populace as the era of depending more on federal allocations before fulfilling the needs of the society would be of the things of the past. Also, the delay in the payment of salaries and allowances of civil servants would be adequately protected and therefore improve workers productivity.

Source

 

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