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🇳🇬 Nigeria /Economy & Trade

Kwara varsity urges AI use in Nigeria’s tax system

From The Punch · (7m ago) English

Summarized and contextualized by DistantNews.

TLDR

  • Kwara State University's Summit University advocates for integrating Artificial Intelligence into Nigeria's tax system to enhance revenue and modernize accounting.
  • Stakeholders noted Nigeria's low tax-to-GDP ratio is due to systemic inefficiencies, not lack of compliance, urging trust-building and simplified processes.
  • The proposed 2025 Tax Reform Agenda includes consolidating taxes and a unified framework to ease compliance burdens.

Summit University in Kwara State is championing a forward-thinking approach to Nigeria's persistent revenue challenges by advocating for the integration of Artificial Intelligence into the nation's tax administration system. This call, made during the maiden edition of the Isiaq Family Foundation Annual Accounting Lecture, highlights a critical need to modernize accounting practices and boost revenue generation.

Nigeria’s tax-to-GDP ratio, estimated at about 9.5 per cent, remains low when compared to peer economies, and this is largely due to systemic inefficiencies rather than a lack of willingness by citizens to comply.

— Dr Adesola OkunolaDelivering the keynote address on behalf of the Registrar/Chief Executive of the Institute of Chartered Accountants of Nigeria, highlighting systemic issues in Nigeria's tax system.

The institution, through its stakeholders, pointed to Nigeria's "revenue paradox" – a situation where development goals outstrip available resources. The low tax-to-GDP ratio, estimated at 9.5 percent, is not a reflection of citizen unwillingness to pay but rather systemic inefficiencies. The key, as articulated by Dr. Adesola Okunola, Registrar of the Institute of Chartered Accountants of Nigeria, lies in building trust, simplifying tax processes, and strengthening institutions.

You cannot enforce compliance in a system that citizens do not believe in. There is a need to build trust, simplify tax processes and strengthen institutions to enhance efficiency

— Dr Adesola OkunolaEmphasizing the need for trust and institutional strengthening to improve tax compliance in Nigeria.

Artificial Intelligence offers a transformative solution, with global applications in forecasting, fraud detection, and automated auditing. However, Nigeria must proceed with caution, ensuring robust regulatory frameworks are in place to manage data privacy, cybersecurity risks, and algorithmic bias. The proposed 2025 Tax Reform Agenda, aiming to consolidate taxes and introduce a unified framework, aligns with this technological push, promising to reduce compliance burdens and improve efficiency. This initiative underscores a national commitment to leveraging innovation for economic development, a narrative often overlooked in international discussions that focus solely on resource challenges.

Nigeria stands to gain significantly from adopting these innovations, but their deployment must be backed by strong regulatory frameworks to address data privacy concerns, cybersecurity risks and algorithmic bias

— Dr Adesola OkunolaAdvising on the necessary precautions for implementing AI in Nigeria's tax administration.
DistantNews Editorial

Originally published by The Punch. Summarized and contextualized by our editorial team with added local perspective. Read our editorial standards.

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