FIRS Nominates MTN, Airtel and Banks to Collect VAT, to be Deducted From Source
- The Federal Inland Revenue Service has appointed two telecommunication companies to take VAT on its behalf
- According to the Service, the firms would remit the VAT alongside deposit money banks
- The Service said that the companies would take the charges and remit them to it following the law
The Federal Inland Revenue Service (FIRS) has authorised two telecom companies, MTN, Airtel and deposit money banks, to withhold Value Added Tax (VAT) charged on all taxable supplies made to them remit the same to FIRS.
The firms must now deduct the VAT from their contractors for goods and services supplied and remit to the Service.
Source: Getty Images
Directives in line with CBN requirements
According to a statement from the FIRS in Abuja by the Executive Chairman, Muhhamad Nami explained the firms' role as well as their suppliers' obligations regarding withholding Value Added Tax.
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The Nation reports that all persons carrying on a trade, profession or business of any type, tax practitioners and the general public, with effect from January 1, 2023, in line with the law, the Service has appointed the companies to charge VAT on its behalf.
Nami mentioned Aitel, MTN and all deposit money banks, as stipulated by CBN guidelines, as lead business entities authorised to take VAT for the FIRS.
The Service noted that the companies were expected to remit the tax they would withhold on or before the 21st of every month immediately following the month the tax was withheld in the way prescribed by the Service.
FIRS said:
"The companies shall remit the tax withheld or collected, in the currency of transaction, to the Service on or before the 21st day of the month immediately following the month the tax was withheld or collected.
According to the FIRS, the withheld or collected taxes under the notice shall be sent to the Service separately from VAT due on the firms' taxable supplies.
The Service also said the options available to suppliers of these companies whose output tax will be withheld.
FIRS said that the Service had initiated adequate measures to ensure prompt payment of refundable input tax under this arrangement.
VAT dispute: Court gives verdict on important request made by Lagos
Recall that Legit.ng reported that the court of Appeal in Abuja has granted a request by the Lagos state government, seeking to join Rivers State in the appeal filed by the Federal Inland Revenue Service (FIRS).
The FIRS had filed an appeal at the appellate court to challenge the collection of Value Added Tax by states.
Channels TV reports that at the resumed hearing of the matter on Thursday, September 30, the court granted the request by Lagos and ordered all processes filed to be served on the Attorney-General of the state, Moyosore Onigbanjo.
Source: Legit.ng
