Manufacturers Lose N1.7trn To Forex Crisis, Says FIRS

The Federal Inland Revenue Service (FIRS) has reported that Nigerian manufacturing companies lost around N1.7 trillion last year due to a severe foreign exchange (forex) crisis, causing many to halt operations.

Chairman of the FIRS, Mr. Zacch Adedeji, disclosed this information during a recent meeting with the Senate Committee on Finance at the National Assembly Complex in Abuja.

Mr. Adedeji attributed the company exits primarily to forex challenges and the devaluation of the naira. Insecurity and low revenue were also cited as factors.

He also highlighted the significant impact of these losses on the country’s tax revenue, noting that the government cannot collect taxes from these companies until they recover their losses, which may take up to a decade.

Since the beginning of President Bola Tinubu’s administration, there has been an increase in the number of foreign companies, especially in the manufacturing and energy sectors, ceasing operations in Nigeria. Major companies such as GlaxoSmithKline (GSK), Procter & Gamble (P&G), Sanofi, and Equinor have exited the market, significantly affecting tax revenues.

Mr. Adedeji stressed the crucial role of taxes in maintaining economic stability and investor confidence.

He equally noted that enforcing tax laws is essential for demonstrating the government’s competence and strategic planning in managing the economy.

He assured that the government is committed to maintaining investor confidence and ensuring economic stability, stressing that nothing should deter investors from trusting the government’s dedication to economic growth.