Case Study for Government.

FEDERAL PARASTATALS.

The prolonged absence of a nationwide electronic switch has resulted in Nigeria remaining a largely cash based economy, relying on manual payment methods with all the associated inefficiencies and inconveniences.

The parastatals of the Federal Government of Nigeria strive for the continual improvement of their organisational and operational procedures; they desire to streamline and improve on their revenue monitoring of the current collection systems for greater fiscal efficiency.

Federal Inland Revenue Service.

The Federal Inland Revenue Service (FIRS) is the operational arm of the Federal Board of Inland Revenue (FBIR) which carries out the statutory functions specified in the various tax laws under the administration of the Board. The task of the Board is to assess, collect and account for the taxes under its jurisdiction in Nigeria. The Board plays a significant role in the formulation of the country’s tax policies as well as the initiation of laws to ensure the efficient administration of the country’s tax objectives.
The responsibilities of the Board cover the following taxes: Petroleum Profit Tax (PPT); Companies Income Tax (CIT); Stamp Duties; Capital Gains Tax (CGT); Personal Income Tax (PIT); Value Added Tax (VAT); Education Tax, Pre-Operational Levy, Provisional Tax, PAYE, etc.

The Challenge

	The management of FIRS used to have problems with identifying and determining what tax was paid, who paid it, where it was paid, when it was paid, who it was Paid to, how the payment was made, how much was paid and where the funds are now.
	Their major challenge was how to prevent funds from been delayed, diverted or converted. Consequently, they sought ways of improving the current tax collection process in order to have more control and better monitoring of their monies.

	The Solution
	The FIRS PAYDirect solution from Interswitch Limited allows the Federal Inland Revenue Service (FIRS) to answer all of the questions in the preceding section and have complete control and information of the monies paid for taxes by taxpayers.
	PAYDirect is a PC-based electronic payment solution that is usually customized for various institutions to suit their various needs for secure, monitorable payment transactions from their customers primarily through bank branches. It is an effective and price competitive way of providing 24/7 e-payments solutions.

A tax identification number is used to uniquely identify all tax payers in the FIRS PAYDirect system at bank branches. Every tax payer would eventually be registered within the application.

If payment is being made at a bank branch, the teller collects the cash or the cheque from the taxpayer and enters the FIRS Tax number, tax being paid for, amount, and any other relevant data into the system.

The taxpayer’s information is supplied to the screen, and the taxpayer verifies.
For payments on the portal, the taxpayer is required to enter the Tax Card Number and PIN. When Pay is selected, the FIRS Remittance Account in the bank is credited, and the payment information is stored at the central database FIRS (and the lead bank) can then view these tax payments. FIRS will then commence internal processing.