Evaluating the Purpose of the Federal Inland Revenue Service (Establishment) Act, 2007

Abstract

The extent any statute in Nigeria conforms to the Constitution of the Federal Republic of Nigeria (As amended) 1999, (here-in-called “Constitution of Nigeria”) determines the extent the statute will be valid. This is because the constitution of Nigeria is the supreme law of the nation and no law in a nation will contravene the constitution and still stand1.  Every statute is made for a purpose which is usually indicated in the long title of the statute. Federal Inland Revenue Services (Establishment) Act, 2007 (here in-called “FIRS Act”)2 is a tax administration statute enacted in 2007 of which some of its provisions erupted thrusts of contentions among tax experts. The FIRS Act was reproached for having provisions adversative to the Constitution of Nigeria and asymmetrical with some tax statutes listed in the First Schedule to the FIRS Act. Upon that imprint, the agitators draw the conclusion that the purpose of FIRS Act is to centralize tax administration in Nigeria in the Services. This paper takes a critical expository glance into the alleged reproach by looking into the grounds upon which the agitators anchor the reproach and other relevant provisions of the FIRS Act. It accesses the provisions of FIRS Act with respect to the powers and functions of the Federal Inland Revenue Service (here-in-called “the Service”)3. This paper as well embarks on a careful scrutiny of those tax statutes listed in the First Schedule to the FIRS Act and the alleged contentious provision alongside the Long Title to FIRS Act with a view to determining the veracity or otherwise of the assertion against FIRS Act. In doing this, one research enquiry is hypothesized to guide this work: “Whether the FIRS Act by any of its provisions intend to and in actual fact centralize tax administration in Nigeria in the Service”. We adopt Doctrinal or conceptual legal research methodology in making this paper and the materials used in this work were sourced from primary, secondary and tertiary sources. This work finds out that even though some provisions of the FIRS Act were literarily inconsistent with the provisions of some tax statutes listed in the First Schedule to the FIRS Act, the alleged reproach that it centralizes tax administration in Nigeria in the Service is unfitting. This paper recommends the amendment of those contentious provisions of the FIRS Act to either make them literary in line with the purpose of the FIRS Act or create a rider to the contentious provisions for clarification purpose.