Gombe is a safe heaven for businesses as the most peaceful in the zone – IRS boss
Abubakar Inuwa Tata – Chairman, Gombe Internal Revenue Service (IRS), Fiscal Responsibility Commission, in this interview with Correspondent CHIMA AZUBUIKE, x rays the challenges faced in changing the narrative at the state’s tax office.
How much impact has insurgency had on Gombe IGR?
The impact of insurgency on IGR is significant positive and negative. The negative aspect is that businesses outside the North East zone considers Gombe State as part of the volatile areas and hence, no new businesses are coming into the zone except those with significant presence or those whose subsidiaries have been in Gombe for long and can attest to the peaceful nature of the State outside the remaining North East States. On the other hand, business within the zone particularly small scale businesses relocates to Gombe as a safe heaven since the State is most peaceful state in the zone.
What is the state’s current monthly IGR and which sector is the biggest contributor?
The State IGR is purely dominated by “Pay As You Earn” as PAYE accounted for 42.2 per cent of the State IGR. Other sources like MDAs receipts accounted for 31.7 per cent, Other Taxes (24.5 per cent), Road Taxes (1.6 per cent) and Direct Assessment (0.13 per cent). On the issue of current monthly IGR, the collections fluctuates and have no regular pattern but on the average, its about N700.00 million per month if you divide the annual number by 12.
What is the projected IGR growth of the state in the next five years and what sectors are you targetting?
The projected IGR figure all things being equal is expected to grow year on year by 10-20 per cent with the full implementation of the new revenue law. However, with the Finance Act 2020, collections from the major component (PAYE) is expected to slow down as taxpayers earning less than N30,000.00 are exempted from paying personal income tax.
Overview of Gombe Internal Revenue Service before your coming to office?
A lot of things have happened here since I came on board. Issues on the governance structure of the service where we have executive chairman and non executive directors. Most of the activities here does not involve the non executive directors. The chairman assumes so much power without consulting anyone, aside few clique of staff. People did all they wanted the way they wanted it, a lot of them printed fake receipts. Customers were easily stopped along the way, any their money diverted to personal purses. These receipt ranged from N200,000 and above especially when you go to the Motor Licensing Unit they make money for themselves and not for the service. Plate number costs N25,000 and driver’s license for 13,500 whereas five years is supposed to cost N10,250 and three years for N6,350 thereabout but they kept building margin on what the service sells the papers and a lot of allegations that Gombe papers are the most expensive. Ordinarily, Gombe has the cheapest vehicle registration but due to the syndicate within and outside Gombe, in the ministries and departments each issuing fake receipts with techno android (hand held device given to some of the revenue officers) which enables them to save, edit and issue fake receipts.
What did you do to arrest the situation?
I started on the issue of fake receipts with the issue of tax clearance and I ensured they (tax officers) downloaded bar code scanner. This is because the receipt has a bar code, the scanner is like a DNA even if you change the information on the face value, you can’t change the information on the bar code. The information inside the bar code is what is here. Once they edit the names as typed they can’t edit the bar code, they can manipulate some but not all. So after scanning each of them we began to ask customers with conflicting details who gave the receipt to them.
What other step did you take aside Bar code?
I have to call revenue officers for a meeting, I told them we will like to install app into the gadgets. When it was brought I asked that they bring it forward. Some quickly reset theirs, but we caught about 5 officers with fake receipts which they use to manipulate figures. From our investigation we discovered that they carry the fake receipts in their flash drive. It was when I came I realized over 10,000 receipts got lost but I had to inform members of the public that the receipts were no longer in use and i decided to change it. That brought sanity on the area of receipts, but we have managed to bring that to the nearest minimum on other hand the vehicle paper which includes road worthiness which is not on the platform, we are ensuring it is on the platform so that we can control it. There was a consultant who was a syndicate, he was engaged here to do something but was busy collecting money from small trucks in Abuja. When the information arrived we sent detectives who went to make arrest.
What were the initial challenges of the service?
We had ineffective governance structure, where the chairman had overriding executive power and uncoordinated collections by State and Local Government’s. There are local governments that collect what the state is collecting which is not supposed to be like that. Even though they had tax consultants some of them did not understand the different jurisdiction between the state and LGA’s. We had to educate them and define it in the new tax law. So also multiple taxation, where one tax head or individual is taxed by the three tiers of government. We had to educate local government revenue officers, treasurers, secretaries on what to collect based on approved rates. We have impersonation of revenue staff some people employed some personnel here to be doing things for them most especially in the motor licensing unit. Some times when you go to town and I ask some people who claim to be revenue staff their section they don’t know but unfortunately in town they are known to be revenue collectors. There is collection of revenue in kind, when you go to a tax payer who sells fabrics, if he doesn’t have money you will tell her to give you fabrics, give me sandal, give me perfume. This is the craziest thing I have seen in my life. Usually I ask tax payers, if you give perfume do you think the items goes into the till of government. Most of them will say they were harassed or intimidated. I noticed a major challenge of the insurance components of motor licensing. I noticed that the entire insurance done in Gombe was fake,when you go to the road safety or staff of the service you will be asked which type of insurance do you want; do you want the one you can move around within Gombe with or the one you can move outside- within Gombe N4,500 down to N2,500. I had to call the entire agents working here to ask them How many insurance claim did you pay? The answer is usually none, and you have been collecting money from the people of Gombe state and when they have problem of third party you can’t pay. If you have a third party claim insurance companies can pay as much as N500,000 anything in excess they will not do it. The issue is the people don’t know their right and the insurance companies have been capitalizing on that so they just print insurance and open shop. There is issue of old revenue rate which were inherited from Bauchi state, they are old and obsolete. Some rates are N100, N50 the cost of the receipt are sometimes more than the receipt.
What are you doing about the obsolete tax rates?
Governor Inuwa Yahaya since 2020 has signed the new law, after passing through normal readings in the house of Assembly that is the new law we have today.
Based on your statement is indicative that prior to your appointment there was high level fraud, so how many staff of the service have you prosecuted?
Honestly, none of the staff have been prosecuted because there are overriding influence from outside. Even though the governor has the political will to say give us the name, when you give the name before it follows civil service procedure and get it done, it a long queue that is why today we are looking for autonomy. When we get it everything will begin and end here. Even though we have paper and financial autonomy but because the service hadn’t board, we have executive management committee the board has not been inaugurated. Once the board is inaugurated the board can take certain decisions on it own.
As a leader with transformational change, how have you helped to save cost and to educate tax audience?
When I came that generator was said to consume N960,000 monthly on running expense, I had to push it to N280,000 significantly. We don’t even consume up to that when we have steady power supply from general electric. I have practically been involved in radio and television sensitisation programmes using our local language to educate the people on the need to pay tax
What are the advantages of paying tax?
When you pay tax you can hold government accountable as an individual. I always encourage people to pay tax and demand for social amenities as a resident you have rights and government has obligations. If you pay your tax you will have right to speak and when you don’t pay you won’t have that right to speak.
How have you handled the issue of collaboration among revenue generating MDAs and the service?
Initially the MDAs were looking at the service as robbing them off their dues. So they wanted to own their revenue and begin to do whatever they want to do with the revenue. Upon assumption of office I called 78 of the MDAs with revenue generating heads and those without after the parley we agreed on a benchmark. Every MDA will have a benchmark that enables them to be rewarded 5% cost of collection above the benchmark of last year you will be compensated. So that they will stop seeing this place like a competitor that is one of the things the governor has approved for us.
80 percent of Gombe population are farmers and are uneducated, what are you doing to ensure taxation and insurance are given adequate priority?
Insurance has social and religious connotations. Even if they want to do the insurance where are the insurance companies the mainstream insurance companies are basically doing life assurance, third party . They don’t go to farms looking for farmers to insure their crops. Yes, 80% are farmers but seasonal farmers they don’t take farming as a business.
As Chairman how often do you visit the field or you leave collection to revenue collectors ?
My working days extends to Saturdays and Sundays. If I don’t work here I work outside. What I do is I take or sometimes enter tricycle as a passenger for the sake of getting information and by Monday I will just direct my men to take demand notice to this and that place. We go after high Networth individuals, after demand notice and they decline, we usually call them for Tax Audit Reconciliation Committee.
Relationship between unions and service?
The unions don’t collect revenue on behalf of the service they have members. What they pay as tax is given to unions and not to government. These unions don’t build anything not even sanitary areas nor do they provide water but money is given to them by their members. What is requested from Mechanics in a year is N2,500 which translates to N7-8 daily and the okada men and okeke drivers in is N2,500 but how much do they pay to unions on a daily basis some N50, N100. For instance N50 multiplied by 30 days is N1,500 and 1,500 multiplied by 12 months is above what they pay to government in a year. We are building documentary to explain how unions earn more than government who bears all .
Gombe state owes from loan from previous administration’s, amidst poor revenue earning, what are you doing in this regard?
To drive the process is tax education, enlightenment, implementation and stakeholders engagement. The reason why emphasis is on IGR is because of the dwindling allocation from there is huge debt over hang 119billion naira inherited with monthly debt service of 1.37billion naira and 45.6million naira on daily basis that Gombe state government has to pay for debt service. There are local government that can’t breathe without Internally Generated Revenue especially Akko and Gombe where there is a debt stock of 2.1 billion naira and 1.04 billion respectively there is need for inclusive development and provision of needed infrastructure.
What is the Fiscal Commission doing differently?
The Commission will continue to work assiduously in 2021 to ensure all expenditure for 2020 are properly accounted for and transparently reported by the Commission and who ever that is found culpable will be reported to the governor. As a commission we are expected to advise the government on the issue of debt; profiling and debt contracting. The debt management office provides financing gaps for the government when there is budget deficit and this gaps come from internal and external borrowings. Loans from government comes at single digit, while that from commercial banks are double digit.
What about the state over bloated work force, what is the way out?
Government is working day and night to resolve the problem. As I’m talking to you all Gombe staff or employees of the state government have been profiled on the biometric enrollment exercise that was conducted and finalised. We are in the phase of implementation, we have experimented the software and we realized government will make a lot of savings. Once it is fully deployed there is no way an employee of government can stay at home or elsewhere be enjoying easy money, people would have to report to work by using the finger print to commence work and close of business. Government will address it before first quarter of 2021.
