Business
The Federal Inland Revenue Service, FIRS, will soon go after the bank accounts of defaulting taxpayers, who are raking in billions of naira in Nigeria and are not paying taxes, according to the FIRS Chairman, Tunde Fowler.
In doing that, the FIRS, through all banks in the country, would do substitution on the accounts, Fowler said, adding that over 6,772 of such defaulting billionaires had been identified by the agency through bank data.
Fowler, who disclosed this at a stakeholders’ meeting, according to a statement on Sunday, noted that most of such taxpayers, who had between N1bn and N5bn in their accounts, had no Taxpayer Identification Number, or had TIN but were not filing any tax returns.
The FIRS chairman stated, “What we have done is what we call substitution, which also is in our laws, and which empowers us to appoint the banks as collection agents for taxes. So, all these ones with TIN and no pay, and no TIN and no pay, totalling 6,772 will have their accounts frozen or put under substitution pending when they come forward.
“First, they refused to come forward in 2016; they refused to come forward under VAIDS and are still operating here. So, we are putting them under notice that it is their civic responsibility to pay tax and to file returns on these accounts.”
Fowler further explained, “We looked at all businesses, partnerships and corporate accounts that have a minimum turnover of N1bn per annum for the past three years. First of all, the law states clearly that before you open a corporate account, part of the opening documentation is the tax ID. From the 23 banks, we have analysed so far, we have 31,395 records, out of which effectively, minus duplications, we had 18,602.
“We broke those into three categories. Those that have TIN tax ID; those that don’t have TIN, and of course, no TIN no pay; and those that have TIN and have not even paid anything.
“So, on a minimum, every company or business included here over the last three years has had a banking turnover of N3bn and above. Some of them have had banking turnover of over N5bn and have not paid one kobo in taxes. Now, the total number of TIN and no pay is 6,772.”
Paraphrasing the Nobel Laurette, Prof Wole Soyinka’s famous quotation of a wasted generation, Fowler said this generation should not repeat Soyinka statement by their conduct, adding, “I plead with the banks to support us; in supporting us, you are supporting Nigeria. In supporting Nigeria, you are supporting all Nigerians and those who have chosen Nigeria as home. And most of all, you are supporting a future that we can leave behind for the upcoming youths of Nigeria.
“I remember this when we were growing up, a statement made by Wole Soyinka that our generation was a wasted generation. That has remained in my mind for many years. Wole Soyinka is still alive. His generation is a generation of 80s and above. Let us not look back and say also our generation has not left any value behind. I think it is time for us to change.”
He noted that the FIRS was also paying closer attention to audit, stating, “We have started a comprehensive audit exercise that involves both national and regional audits…because we got to a position where we found out that majority of the major organisations that were allowed to do self-assessment did not truthfully declare or pay the taxes that were due. To date, we have raised assessment of over N805bn from 1,324 national audits, out of which 499 (taxpayers) have N219bn.”
He did not spare the FIRS even though it had made over N1tn in its collection between January and August this year.
Fowler added, “If you look at the 2018 revenue to date, between January and August, we have done N3.5tn, which is N1tn over 2017. But the main point I want to make is that majority of taxpayers that accounted for this revenue have not changed. The laws have not changed. And to a great extent, the consultants to these companies have not changed. If you look at 2017, there was an increase of close to N800bn over the 2016 collection.
“The increase in 2018 so far showed N1tn. If the same consultants advised or reviewed the accounts of the majority of the taxpayers, one would wonder why such large increases occurred. It is either the taxpayers did not disclose fully their financials to the consultants or the consultants were involved in tax planning. Either way, it is not for the wellbeing of our nation, Nigeria.” – Punch
– Sept. 10, 2018 @ 8:35 GMT
Tags: We’ll go after billionaire tax defaulters – FIRS
