- Objective and Compliance Challenges: The Nigerian Federal Inland Revenue Service (FIRS) is implementing an e-invoicing system to enhance tax compliance and curb revenue leaks, addressing a national tax compliance average of only 50%. The project aims to digitize invoicing processes and improve the tax-to-GDP ratio, but challenges remain due to political resistance and a lack of trust in government institutions.
- Technical and Infrastructure Concerns: While the e-invoicing initiative appears promising, Nigeria’s inconsistent digital infrastructure and the need for strong enforcement mechanisms pose significant risks. Successful implementation requires seamless integration with financial systems, reliable technology, and consistent regulatory enforcement to prevent businesses from circumventing compliance.
- Credibility and Future Implications: The e-invoicing project represents a critical test of FIRS’s ability to modernize Nigeria’s tax administration. Its success could pave the way for broader digital governance initiatives, while failure may reinforce skepticism among businesses about tax authorities. The pilot phase is set to begin with major taxpayers in July 2025, with the potential for significant economic impact depending on effective execution.
Source reg-tech.co
- See also
- Join the Linkedin Group on Global E-Invoicing/E-Reporting/SAF-T Developments, click HERE
