Growth & Employment in States (GEMS) Nigeria: ... Supporting the business environment through improved land, tax and investment reform.

GEMS3 works with private and public stakeholders at national, state and LGA levels to build and deliver a systematic framework that helps make it easier to do business in Nigeria, leading to lasting improvements in economic opportunities for the poor, especially women.

The GEMS 3 team in COOL FM KANO  after an interview.

Kevin Conroy

Intervention Manager

Muktar Ado Yakassai Tax expert GEMS 3

 

DFID Nigeria has a "State Partnership for Accountability, Responsiveness and Capacity" programme, to improve financial management systems and enhance government use of public resources at state level. In some states, this programme supports tax collecting agencies, for example, with systems, procedures and controls in collecting land and employment taxes. 

DFID Nigeria is providing £90 million in support to the ‘Growth and Employment in States’ (GEMS) programme which includes work on tax. The programme supports the value chain and business environment, as well as land reform and investment policy. An estimated £9 million is expected to be tax related, focused at state level.

This project follows the Nigerian sub-national government Investment Climate Project (ICP) from 2007 – 2011, which identified taxation as one of the key, feasible areas of reform. Support provided under the ICP included assistance with the development of state-level 5-year tax board modernisation plans, training for 600 tax officials (the first training on tax many of them had ever been exposed to) and substantial support to the introduction of unique taxpayer identification numbers (UTIN) which has now reached the stage of formal testing.

The latest programme (GEMS) will use an innovative 'market' approach to understand and address tax as it affects and is affected by market systems and political incentives, with a special focus on impact on the poor. It will have a strong focus on sustainability, looking at facilitating (rather than providing) pilot reforms, which it will seek to have replicated across the country through demand and demonstration effects.

The project will introduce a range of varied interventions in different states, including; mapping and documentation of existing tax processes, business processing re-engineering of tax processes, tax harmonisation and the removal of multiple and 'nuisance' taxes, and support to target states' existing, broader, reform plans.

DFID is also funding £11 million for the Enhancing Nigerian Advocacy for a Better Business Environment (ENABLE) programme. This programme, running until 2013, is to improve the environment for business advocacy in Nigeria. A small part of this programme worked to improve public-private dialogue in Lagos State on the issue of Multiple Taxation.

In 2011, DFID provided £89,000 to the International Monetary Fund to rewrite tax legislation in Nigeria.

HMRC has also provided assistance to Nigeria - two compliance caseworkers spent time in Nigeria helping the Federal Inland Revenue Service develop a compliance strategy, and senior level HMRC management sit on the board of the Nigerian tax administration in an advisory capacity.

 The teams are embedded in each of the focal states, with ambitions to expand as they enter other states across the country. Support to state teams is provided from the central office in Abuja that also manages the Federal level interventions. For further information, contact info@gems3nigeria.com.