In order to make tax payment more convenient for tax payers, the Federal Inland Revenue Service (FIRS) last month introduce electronic filling and payment of taxes. The initiative was in partnership with SystemSpecs, owners of the Remita electronic payment platform, which can be used for electronic filling and payment of taxes. In this interview, John Obaro, speaks on the objectives and benefits of e-filling and payment of taxes and the role of Remita in the initiatives. Excerpts
What does e-filing imply to the taxpayers?
Well before now, the Federal Inland Revenue Service (FIRS) has been collecting tax reports manually. So, they have now created a platform for organisations to be able to file electronically. Now, when you submit your documents into their portal, you will get a reference called document number.
You will take that document number to your Remita platform, to make payments and your payments leaves your bank account and goes to FIRS account, you get an acknowledgement and you also have proper records of the taxes you have paid.
What exactly is the role of Remita in this scheme?
The role of Remita is a payment engine. Now, a number of organisations today already use Remita to pay vendors, to pay salaries, pension fund administrators and different types of payments. But now, they are able to make tax payments to FIRS. When they pay through the platform, they don’t need to submit any document again because we are integrated at the back to FIRS. So, we submit the data that, that organisation has provided to the FIRS in addition to moving money to the FIRS.
But does e-filing means that the manual way of paying tax in the country will no longer be in existence?
Well, I believe it is going to happen gradually because not all the FIRS offices have been converted. So, they are doing them in phases. There will be a period of transition, but ultimately the idea is that it goes to a paperless filing arrangement.
What will be the impact of this scheme on the economy?
The truth is that many times we judge people that they don’t want to pay taxes. But the truth of the matter is that the payment process, if it is too cumbersome, some people who want to pay would just end up not paying because they would get carried away by something else. By making it easier for people to pay, it is expected that the collection would improve.
Now, you have a 24-hour arrangement to pay. There is no need saying the managing director is out of town and he is not going to be back until next week. You don’t need those excuses again. It is now easier to pay from your home, from your offices and from your mobile devices. So, it is expected that the total collections would grow.
Did the federal government and others involved in the introduction of this scheme take into consideration the technological challenges we have in the country? And for those that are not technologically savvy, how will they be able to use this system?
Well, the first thing you talked about was infrastructural challenges. The mere fact that there are infrastructural challenges has not stopped the rapid growth of e-payment in Nigeria. We are not where we were five years ago. In fact, we are not where we were two years ago. So, a lot of things are improving. We know we are not yet there, but we should not discountenance the fact that a lot of progress has been made.
We cannot wait and say we cannot practice e-payment until everything is perfect because that day will not come. Even if you go to the developed countries, you still have occasional failures. You still have communication challenges. It may not be as much as we have here, but they still happen. So, I really would not want us to focus on a glass that is half empty, let us focus on the portion that is half full.
We have the opportunities with us here and things are happening and things are getting better. So, let us focus on the fact that it is growing and the challenges that are coming up are not unresolvable.
But the process of the e-filing seems to very long. Let’s consider the average individual, would that not be discouraging to him or her?
For e-filing, we can say that this is the first version of the product. With the first version of the product coming out, there would be some lessons learnt and in the not too distance future, we would expect some improvements. But for clients on Remita, what we have done is to create a simply access point for them to be able to make all their payments and save themselves some cumbersome processes. So, like I said earlier, things may not be perfect, but they will improve with time.
There is e-filing and e-payment, are both accessible through Remita?
Remita is basically an e-payment platform. It is expected that you must have done your e-filing to collect your reference. When you now come to Remita, we will now interrogate the FIRS platform to bring out all your information, and then you make your payment.
What is your expectation from the e-filing scheme generally?
My expectation is that the taxpayers now know that there are electronic options for them to begin to make tax payments. They may file electronically and effect their payments. They do not necessarily need to go to a bank branch again and they need not move from one bank’s internet banking to another bank’s internet banking again. Log into Remita and make payment from anywhere.
What is the relationship between Remita and the banks?
Now, when customers register on Remita, they fill an application form to their banks, it is their banks that actually register them on the platform. It is a multi-bank platform, so customers come on the platform and put in all their bank accounts. When it is time for them to make any payment, they just select which account they want to fund from. It need not be tied to any particular bank. You may have accounts with different banks. So, you just select the one you want to fund from at that point in time and it goes through the internal approval rule of that organisation.