The Federal Inland Revenue Service (FIRS) has introduced the Integrated Market Revenue Management System (IMRMS), a digital platform designed to integrate the informal sector, particularly market traders, into the federal government’s tax framework.
This move aligns with the VAT Direct Initiative (VDI), a joint effort with the Market Traders Association of Nigeria (MATAN), aimed at promoting VAT collection and remittance awareness in the informal sector.
As reported by Business Day, the FIRS had announced in July its intention to partner with MATAN for the collection and remittance of Value Added Tax (VAT) in the informal sector, utilising unified systems technology.
Under the VAT Direct Initiative, FIRS is leveraging the IMRMS platform to streamline VAT payments for market traders.
The collaboration with MATAN, representing over 40 million traders, involves digital enumeration, providing digital identities, and tracking turnovers to ensure accurate VAT collection and remittance to the FIRS.
The FIRS-MATAN initiative also addresses concerns related to multiple taxation in marketplaces. By working with security agencies, it aims to curb the activities of touts, miscreants, and unauthorised tax collectors involved in illegal tax collection in Nigeria’s market spaces.
Mr. Adebayo Adefeogbe, a director in the FIRS, emphasised that the coordinated approach would grant the government access to almost 70% of untaxed revenue in the informal sector.
He highlighted the potential of collecting VAT from over 40 million traders, foreseeing enhanced government capacity to provide essential amenities in marketplaces nationwide.
Moses Ige, MATAN National Coordinator of Incentives, urged market leaders to sensitize their members about the benefits of the VAT Direct Initiative, including health insurance, micro-pension, general insurance cover, low-interest non-collateralised business loans and grants, social amenity provisions in marketplaces, and free legal services.
Ige emphasised that the VAT Direct Initiative opens avenues for registered traders to enjoy services equivalent to those in the public sector, extending from health insurance to free medical care, insurance cover for losses due to disasters, access to loans, micro-pension schemes, and collaboration with the Bank of Industry for small business loans.
This initiative, heralded by the VAT Direct Initiative and the recent IMRMS launch, signifies a significant step towards effective VAT collection and remittance in Nigeria’s informal sector.
