Tax Refunds Delay is Crippling Businesses – Bauchi Chamber of Commerce Blasts FIRS

The Bauchi Chamber of Commerce, Industry, Mines and Agriculture (BACCIMA) has publicly criticized the Federal Inland Revenue Service (FIRS), urging the agency to stop the prolonged delay in processing Withholding Tax (WHT) refunds, a situation BACCIMA claims is crippling many small and medium enterprises (SMEs).

Dependable NG reports that the President of BACCIMA, Aminu Mohammed Danmaliki, made this appeal at a press conference in Bauchi. He lamented that although companies are compelled to pay 10 percent of their contract sums as WHT—which should be refunded after they meet their full tax obligations—many firms hardly receive the money on time due to bureaucracy and corruption.

Danmaliki explained the damaging effect of the delay, stating: “Many companies have their capital trapped for years. The funds that should have been used to expand their operations remain tied up because of delayed refunds. It is hurting growth and discouraging investment.”

The Chamber highlighted the unfair imbalance in accountability, noting that while FIRS quickly penalizes companies for late tax payments, the agency faces no penalty for delaying refunds. BACCIMA proposed that FIRS should also pay interest and penalties when it fails to refund taxpayers promptly.

Demands for Reform and Accountability
BACCIMA also extended its criticism to other government agencies for their role in delaying contract payments, even after projects have been certified as completed. Danmaliki stated that contractors wait for years to receive their money, pushing businesses into debt and making it difficult to pay workers.

The Chamber urged FIRS to reform its refund process by establishing a transparent, time-bound system that ensures refunds are processed within 30 days. To boost accountability, it called for the creation of a jointly managed WHT Refund Account, supervised by FIRS and the private sector.

Danmaliki appealed to the National Assembly and the Federal Ministry of Finance to provide strict oversight, emphasizing that WHT funds belong to the private sector until reconciliation. The Chamber warned that without reforms to the refund and contract payment systems, more companies face closure, leading to job losses and slower economic growth.