FIRS Introduces Automated VAT Filing & Collection System

The Federal Inland Revenue Service ("FIRS") has automated its Value Added Tax ("VAT") filing and collection system. In a public notice recently issued by the FIRS informing taxpayers of the automation, the FIRS stated that the automated VAT collection system is to ensure the efficient and seamless remittance of VAT on all VAT-able transactions in the wholesale/retail sector, and enable direct audit/reconciliation of all VAT transaction. The automated vat collection system applies to the following businesses:

• Branded shops;
• Superstores;
• General supermarkets;
• Standard restaurants; and
• Eateries

The effective date of operation of the automated vat platform ("VATrac") will be from Wednesday, 1st April 2020 (the "Effective Date"). After this date, the VATrac will become the approved channel for vat returns filing and payment processing. Businesses in the above categories are therefore mandated to ensure compliance and prompt connectivity with the VATrac.