Gov Emmanuel’s Era Has Ensured Paradigm Shift In Internally Generated Revenue – Mr. Okon Okon

Akparawa Okon Okon, a financial management expert, seasoned administrator and career banker with over 30years experience in the industry is the current executive chairman, Akwa Ibom Revenue Services (AKIRS).

His appointment three years ago has changed the fortunes of the state revenue service, giving the government a good Internally Generated Revenue (IGR) from what it used to be. From the previous all time high of N16billion ever earned in a year by past boards to the current N32billion garnered in 2019 under his watch. His sterling performance has therefore attracted tremendous applause and accolades across the state and beyond.

In this interview with Crystal Express, Mr Okon, a very sound and meticulous administrator, speaks on his Board and management innovations and the strategies that took the current State internally generated revenue (IGR) above what was obtainable in the past.

He also sheds light on further plans to increase the State IGR through relentless drive among other salient issues.
Excerpts

What have been the motivation and critical success factors since assuming office with your team at Akwa Ibom Internal Revenue Service AKIRS?

I will break it into two broad parts. One is the Almighty God factor and by His grace. Our faith in God has worked tremendously for us. It’s been a miracle. Our strength and hope come from Him and we can do nothing except what the Lord energises us to do. To unbelievers, it may sound strange to them, because they may think it is by the knowledge and capacity of the management alone. But The Bible says ‘we can do all things through Jesus Christ who strengthens us.’ We don’t joke with the God factor and the result we recorded today is driven by God’s grace.

Having said that, coming to the circular management world, I mean the management and administrative perspectives so that we can relate to these things in the physical, the factors that have encouraged us to improve on what we met on ground. The first is the encouragement, the vision, the support and the administrative style of Governor Udom Emmanuel. He is the one that has the vision of transforming the Internal Revenue Service of Akwa Ibom State. He is the owner of the vision, the visioner and the dreamer.

And to bring the vision to reality, he sent a bill to the Akwa Ibom State House Assembly for a law to be passed that will grant autonomy to the board to function effectively and the law was passed in 2016 and called Akwa Ibom State Revenue Administration Law. To give life to that autonomy, the governor appointed a board that was inaugurated in April, 2017 and by the grace of God and with all sense of humility, I became the chairman and leader of the Board.

We are now interpreting the vision of the governor with regards to internal generated revenue (IGR) in Akwa Ibom State. Now having arrived, we set for ourselves broad objectives that we must accomplish and wanted to be rated and remembered by those objectives.

The five objectives are:
1. We concluded that we must rapidly and significantly increase the IGR in Akwa Ibom State and want to be remembered for that.

2. We must introduce technology and be ICT compliant in our activities so that he can block leakages and bring about efficiency in the way and manner we administer IGR in Akwa Ibom State.

3. We must improve significantly in our physical infrastucture, working tools and the general working environment to give us the leverage to deliver on expectations of the state governor and the people of Akwa Ibom State.

4. We included that since our people are very vital and key to our success, we must train, sensitize and equip them for greater productivity while working as a team with accurate focus and shared vision, objectives and ideas. This is always at the back of our mind as we move on together. We call this humanness

5. Which is the last but not the least is to build the institution to have a character. Before now the institution’s character was at the lowest ebb with many negative activities going on, for which I will not go into details but we needed to correct that impression about ourselves. We also need to get the institution properly structured with the fundamentals and the principles put in place.

Our major joy will be the success of the institution after we have exited the stage. So we needed to erect a solid foundation which will ensure the rapid growth of the State IGR after we are gone in order to have an unending joy. We are happy with the journey so far but will not rest on our oars to ambitiously ensure that we remain on the steady lane of progress. These are the five cardinal objectives and whatever decisions we are taking are reflected or emptied into the five cardinal objectives.

RELATED: Mr. Okon Okon: Breaking Barriers To Meet Target At AKIRS

Therefore, any decision we take that does not dovetail into at least two or all of the cardinal objectives is not a good decision. The secret of our success is in team work. We are united and we take decisions collectively. We have board and management meetings on a regular basis so that we take collective and binding decisions. Team work is very vital, so that the vision can be shared with everyone participating in realizing the objectives. So no one will be left behind. The staff, union, management and board must always be on the same page without friction or conflict. If I give you any information here and you meet any senior management staff, he will tell you the same thing. There is this strong sense of patriotism we have achieved individually and collectively which clearly stated that Akwa Ibom State must come first in all our activities.We are not here for self aggrandizement. The state comes first before any other interest. Therefore, all that we are collecting goes to the state coffers. We have agreed that there will be no collection of cash, no corner cutting, no unprofessional or unethical behaviour is allowed because we are serving the interest of the state. We will be satisfied and feel much better if the state is happy with our services.

The institution now has character and we also have character. In this business, integrity is the key. If you want to be a good tax professional, you must have integrity to be able to attract the confidence of your tax payers. They must trust you and have confidence in you. They must believe that whatever they are paying is correct and that it is going to the coffers of government. And once the tax payers know you are transparent; they will honour their obligations without hesitations. The introduction of technology in our operations has gone a long way to helping us to operate smoothly. Lastly, I must tell you that the entire processes we have on ground was reorganized to be more result oriented. However, we are still at the beginning of the planned growth on the IGR process of the state. There is still much to be done. We will get to a point where the IGR will form major bulk in budget financing. It is a work in progress.

Over time there has been a cry from the public over the issues of multiple taxation. What is your take on this problem?

The issue of multiple taxation is a general problem across the country. But in Akwa Ibom State, we have put some structures in place to stop that. As a board we work with structures. There is a structure called State Joint Revenue Committee which is recognised in the Constitution of the Federal Republic of Nigeria, which was not activated in the State until our arrival here. We activated and inaugurated that structure in January, 2018. The structure comprises all the revenue officers of all the 31 local government areas of the State, representatives of the Ministry of Local Government and Chieftaincy Affairs, representatives of Federal Inland Revenue, Federal Road Safety Corps, Revenue Mobilization Committee and that of customs, immigrations and other revenue agencies that operate within the state.

The aim is to bring all the tax authorities in Nigeria together in the State to work as a team and define our jurisdictions. The problem of multiple taxation arises from conflicts in jurisdictions. By this we mean who should collect what within the law of the federation as enshrined in the constitution. There are well listed types of taxes that the federal government is entitled to. So it is also defined for the state and local government. But ignorance makes some revenue officers to invade areas reserved for state and it amounts to multiple taxation. Sometimes geographical delineation in which urbanization has closed gaps on the boundaries of local governments as we have in Uyo Capital City metropolis which comprises of about five local governments making it difficult for people to even know the boundaries, except the natives. You can hardly know the boundary between Uyo and Itu, Uyo and Ibesikpo or Uyo and Uruan local government areas. So teams from each council could trespass to another and multiple taxation arises. Now the state government decided to be collecting business development levy on shops and a council may also go to collect from same whereas they are only entitled to collect from kiosks.

The question now is how do you define a kiosk in the market place? We all know what a kiosk is but the tax collectors from the local government areas will see a permanent building with business and they will go after them for tax which ordinarily belongs to the state government. That create conflict at times. Now that the committee has been activated, the responsibility is to harmonise all the conflicting areas and make it easier for the tax payers. We have a temporary secretariat for the committee now at Abak Road for those who have challenges of multiple taxation to go and lay their complaints for solutions.

We also meet from time to time to address the problems of multiple taxations. We will soon have a town hall meeting in the three senatorial districts of the state to address the problems and issues surrounding multiple taxation. We will go with all stakeholders in the industry to the event. The challenge presently is the coronavirus pandemic which is yet to allow people come together.

Between 2019 and early 2020 we noticed that your enforcement agents sealed many companies over tax defaulting. However we have not seen your people sealing any company again. Are they now complying or you have changed tactics?

Tax enforcement is part of processes to get tax payers comply not only in Akwa Ibom State but all over the world. People don’t pay tax willingly. You must move and act for people to comply. It is not easy to have voluntary compliance. But before any enforcement is done, we must go to the court and obtain an order authorizing us to carry out enforcement and also close down the premises.

We needed to drive that compliance into the consciousness of our people since, for some time, such acts were not taken very seriously. But now our enforcement is yielding results. The enforcement action is continuous; it is part of the method you need to achieve results. This year we had started earlier before COVID-19 . We hope to continue after COVID-19 is gone. So we follow a legal channel by getting order of restrain from the court. This government will not embark on any illegality as you know that our governor is a man of integrity. Before you see us enforce by sealing any company, we have legal backing. However, we are seeking to get more court orders which sometimes takes about three months.

Percentage wise, have you reached your zenith in tax revenue collection for the state? Secondly, how do you deal with companies operating offshore? Do you have facilities to get them comply with tax payments?

In terms of percentage growth, in 2019/2018 we grew by 23%, 2018/2017, we grew by 42%. But the interesting aspect of the thing is that Akwa Ibom State was created in 1987 and the current board came into being in 2017 which is exactly 30 years. We have the 30 year records year by year. Thirty two years after the state creation, the highest revenue being collected is the N32 billion.

The board under Government Udom Emmanuel strived to move it to its current level from hovering between N15 and N16 billion. Therefore, Governor Udom Emmanuel’s era brought about change and shifted the paradigm from the N15billion region. First we moved to N16 billion, subsequent year we moved to N24billion and the following year N32billion. If we follow the progress, we would have said that even with the worst case scenario this year, we should have ended with at least N40billion. But we are not yet sure in the face of the raging COVID-19. It is too early to predict the outcome presently with this pandemic.

Tax is a function of the economy. if the economy goes down, tax will go down. We don’t collect taxes from the thin air but from the economic activities and employees. If the number of employees were reduced by oil companies and number of businesses closed down, then naturally the revenue will go down. But we will do our best to make sure that it doesn’t really crash because the Bible says ‘the steps of the righteous man are ordered by God, even though it falls it will not be totally cast down because the Lord will uphold him.’ We believe that the Lord will uphold us so we won’t be totally cast down. However by the way of human management, we do not expect the IGR of this year to be as high as that of last year because of the current situation but anything can happen. Now, coming to the issue of the oil companies operating offshore. We have set up a machinery to ensure that oil firms not yet in our tax net are brought into our net. We have recorded some successes. A number of the companies dragged into our tax net are remitting their taxes now. There are still few that have remained adamant and have refused to accept that they are operating within the territorial integrity of Akwa Ibom State. When it comes to offshore issues, it is a bit technical.

We have taken some of them to court to prove to them that they are operating within Akwa Ibom territory and once we have proved it legally to them, their oil servicing companies will all fall into line. Beyond what we have done here, the governor has set up a committee within the ministry of environment and petroleum to help bring oil firms operating within Akwa Ibom State territory to come to the round table for discussion and IGR will feature prominently in the discussion.

The ministry of transport is also mandated to bring up all those operating marine transport activities in our waters to the table for discussion. All these put together will give us the desired results. We are mindful of that and also working assiduously to bring taxable persons to the tax net. Our sister states have many oil companies operating there and largely onshore which is not controversial but if companies operating in our offshore will be willing to pay their tax, what we are receiving presently will be a child’s play.

Recently it was in the social media and even some traditional media that your high performance in office was informed by your desire to go for highest political office in the state, what is your take?

Let me use this opportunity to explain the way I work and the way my mind works. His Excellency Governor Udom Emmanuel brought me here alongside other members of the board with a clear cut mandate to go and increase the IGR, block loopholes and provide him funds to use and develop the state. That is the mandate handed down to me by the governor and my focus remains on that mandate. I want to state here that until the governor calls me to say that he has changed my mandate, I won’t be distracted or lose focus to any distractive tendencies. I am a professional who operates within the limits of my mandate. I did not come here for politics. My major mandate is to increase the IGR of the state and you know that you will not mix that with politics. If you try to mix both, problems will arise. People that you should collect taxes from, you may not be able to do that anymore. However you cannot stop people from making insinuations. None of the people writing that have approached me to ask any questions. On my own I have not consulted anybody and have not set up any team to do so for me. I need total concentration to post good results on my present mandate.

Recall that I came from the banking sector where we are result oriented and have targets. If you check my banking career, my pedigree, you will discover that I rose from the first level as a graduate to the highest level as a general manager. My career is filled with high points owing to performance. It is part of me not because I am so good but God’s grace which abides in me all through my career. I became a general manager after putting in 16 years in banking and that was a feat. While recording those milestones I wasn’t looking for anything in politics. Incidentally any job I am given, I turn it around for good. I am used to turn around responsibilities. Some people are just beginning to know me and I know that performance here prompted the insinuations. But for me the primary thing is to assist the governor in his completion agenda. Politics is secondary for now.

Covid-19 has already ruined the economy. The governor has slashed salaries of political appointees and also planning to slash that of civil servants. What is your advice as a professional for the state to remain afloat in the face of oil price crash?

We are presently in a state of crisis globally. In management good leaders are known during crisis period, when the sea is calm in a boat, everyone can claim to be the captain but when the storm arises that is when you know the real captain. Believe me Governor Emmanuel is a good leader because of his capacity and he has demonstrated it in the leadership of the state during the crisis situation. Recall that we had Late Dr. Clement Isong from Awa Iman where the incumbent governor hails from. He was also a banker of repute, one time Central Bank of Nigeria (CBN) governor and history has it that he remains the best CBN governor having implemented the best fiscal policies during the Nigeria-Biafra Civil War without external borrowing. It remains in his honour till date. In a time like this, we have seen the action of our governor by setting up an economic think-tank with vast knowledge in economics to join hands and minds with him to navigate the current situation.

The committee is expected to turn in their report in one week’s time and I cannot preempt the outcome of their sessions. I was also co-opted into a sub-committee, what I can tell you is that in a situation like this you will have short term strategy, medium term strategy and long-term strategy. For instance, what you can do immediately for the ship of the state to begin to sail, what you will do in the medium term to stabilize and build a solid foundation for growth in the long term. Under Governor Emmanuel, decisions are carefully made even though painful at times but the end is for the general wellbeing of the people and the state. We may pass through some momentary pain in some of the decisions but that is what we will need to transit into enduring prosperity. So many people will come out better than they were before COVID-19, because the pandemic on its own has thrown up so many hidden opportunities. And it takes those gifted with insight and foresight to identify and tap from such opportunities and maximize the gains from them. Our governor is a man of great foresight and we trust completely that he will lead us to the Promised Land.

The people are happy with the leap in IGR. Where would Akwa Ibom have been by now if it had enjoyed the total compliance of all the multinational oil firms in paying their taxes to the state? Secondly, are these firms fair to subject the state to rigorous process before parting with taxes?

I want to start with appreciating the accolades we have received from the people of Akwa Ibom State in the past three years which may have prompted the speculations on my next move. However I must state that if there was no Covid-19, the internally generated revenue would have gone up to N40billion. But in the scenario we have the maximum cooperation of oil firms operating within our state in paying their taxes, we should comfortably be raking in about N60billion annually, which is an average of about N5billion monthly. This will only be possible when the oil firms evading taxes accept responsibilities and which ordinarily will force their oil serving firms to follow suit. A situation an oil firm is claiming not to be operating within our territory, all the firms working under them will join in defaulting.

We abandoned the IGR drive for a very long time because we had so relied heavily on FAAC during the previous administration. IGR is not easy to collect. It is not like Federal Allocation where you can sleep throughout the weeks and get to Abuja on due date and collect.

Today with a heavy shortfall in revenue, the governor needs the IGR to continue his programme and projects for the people such as the roads, schools, hospitals and others. We need more money now than ever before, given the several projects the governor is currently handling across the state and many more in the pipeline including the expansion of our aviation business.

This was his objective in bringing up a vibrant board in AKIRS to achieve these objectives. We are not resting on our oars to ensure that all eligible companies and other businesses operating here are brought to our tax net.

Given a watertight and fraud free operations currently going on in AKIRS owing to the closing of all loopholes for free money, what is the package to keep your hardworking staff motivated and their welfare enhanced?

You know we are operating under the law which also stipulates the operational funds we are entitled to monthly and the governor has kept faith with the funds as enshrined in the law. The law says the operational funds will be between 2.5% and 5% of what we generate but the governor chooses to operate at the upper level which is 5%. We also have introduced incentives, some monthly, some quarterly, some performance drive, while some are general incentives.

In fairness to my colleagues who are men of integrity, it is now very difficult to hear a tax official asking any client to pay into his personal account. We have trained all our staff and everybody here has bought into the treasury single account policy which we have since activated. The staff are happy because we have many ways of motivating the workforce. We are very happy tax collectors now.