The Lagos State government has unveiled a bold initiative to increase its annual revenue by N200 billion by broadening its income tax base to include remote workers and utilizing digital solutions to improve revenue collection.
A summary document for the EKO Revenue Plus Summit says that Lagos State wants to bring in N5 trillion from four primary sources of internally generated revenue (IGR). The summit is set to take place on September 25th and 26th, 2024, with the theme “Unlocking New Revenue Streams for Lagos State.”
In the digital economy, Lagos State plans to introduce a Resident Global Digital Citizen Tax Management System for remote workers, foreign firms, and digital influencers.
Read also: NIGCOMSAT’s revenue rises in 2024, says Tijani
In addition, operators in the digital economy will be accredited and licensed under this system, which will be backed by a robust platform that includes an e-portal, a marketplace, and a Recovery Platform.
According to the synopsis, the program will cost N250 million for portal creation, data mining, partnerships, stakeholder engagements, and messaging.
The objective of the southwest state is to annually generate N200 billion from approximately two million individuals in this region.
Transforming Revenue Strategies for the Digital Age
Digitalization of Government Services and Data Monetization: Lagos State intends to establish a public data marketplace for licensing and monetizing data from various government services. Lagos ProveIT and Lagos State Document Validation and Authentication Apps are crucial. This project might cost N500 million and generate N50 billion annually.
Lagos Fintech Hub: The state will assist digital payments, mobile money, loans, and crowdfunding with a fintech hub. The targeted budget is N5 billion, with vendor transaction fees and platform services generating N100 billion annually.
Lagos State Software Development Centre: A new hub for finance, SMEs, and retail software development is proposed. With an N500 million budget, the effort seeks N150 billion in subscription and service fees.
Lagos State Digital Economy Acceleration Hub: This initiative involves selecting and developing 100 innovative startups through a hackathon and subsequent support, with an estimated cost of N12 billion and expected revenue of N100 billion per year from profit-sharing models.
Lagos State Advertisement Network: A state-owned advertisement network and approval management platform are anticipated to be created. With a budget of N500 million, the projected annual revenue is N15 billion from income fees and permits.
Blockchain and Tokenization Agenda: Lagos State plans to implement tokenization for real estate, infrastructure, and intellectual property. This project will require N500 million and aims to generate N100 billion annually from income fees and permits.
Digital Service Tax (DST) with FGN: The state will implement DST with the FGN to generate income from global digital platforms in Nigeria. It costs N750 million and is expected to generate N50 billion yearly. Digital Service Tax (DST) with FGN: The state will implement DST with the FGN to generate income from global digital platforms in Nigeria. It costs N750 million and is expected to generate N50 billion yearly.
Read also: Nigeria plans to teach 1,000 youth AI and Blockchain annually
Lagos’ Revenue Ambitions Unveiled
Lagos State wants to reach N5 trillion in internally produced revenue (IGR) under the leadership of Babajide Sanwo-Olu by the time of the EKO Revenue Plus Summit in September.
The document stated: “Increasing Lagos State IGR to 5 trillion Naira in the life of the current administration requires a comprehensive and innovative approach that leverages technology, strengthens tax administration, expands the tax base and explores new revenue stream options, especially in non-tax areas, while optimizing existing processes.”
To support the Lagos New Money Initiatives, the Lagos State government wants to significantly increase the amount of money it makes from its resources.
The plan hopes to increase the IGR to an incredible N5 trillion by creating a new source of income worth N2.73 trillion.
This initiative intends to expand upon the IGR framework objective of N1.25 trillion to establish a substantial financial foundation for the state.
The Lagos State administration wants to generate N2.73 trillion in incremental IGR from four important economic subsectors.
These subsectors—the Informal Sector, Digital Economy, Property Industry, and Circular Economy—are all poised to make substantial financial contributions to the state’s economic expansion.
The Digital Economy is predicted to add N750 billion, while the Property Industry would produce N1.5 trillion. N460 billion from the Informal Sector and N20 billion from the Circular Economy are projected.
