Federal Inland Revenue Service (FIRS) to go after 325,000 companies and persons for tax evasion.

Prosper

Executive Chairman, FIRS, Dr. Babatunde Fowler

The Federal Inland Revenue Service would soon go after multinational companies, corporate organisations and individuals who are evading payment of taxes in the country.

The move, according to SUNDAY PUNCH’s investigations, is part of a renewed effort by the agency to boost tax revenue to fund the programmes of the Federal Government.

Statistics obtained from the service revealed that out of the 450,000 companies in Nigeria, only 125,000, representing 27.7 per cent, pay any form of taxes.

Going by this figure, it implies that about 325,000 companies are evading tax, thus denying the government huge revenue annually.

In the 2015 fiscal year, the FIRS was given a revenue generation target of N4.5tn by the Federal Government and it has so far generated N2.667tn.

But between January and July, findings by SUNDAY PUNCH showed that the service had collected a total sum of N2.374tn against the target of N2.667trn, thus having a revenue shorfall of N290bn within the seven-month period.

The past Chairman of the FIRS, Mr. Sunday Ogungbesan, had said the service was finding it difficult to track the financial activities of those who did not pay taxes, as most of the evaders were no longer active.

But the Acting Executive Chairman, FIRS, Mr. Babatunde Fowler, in his first official meeting with the management staff of the service, was said to have vowed to ensure that all tax revenue due to the government would be recovered from all tax payers.

Fowler said his administration would not take the issue of tax evasion lightly, as he was aware that some foreign companies that were operating in Nigeria were being investigated in England for evading taxes.

He said, “No country can succeed without taxation. We will make sure that we cover all ground, especially on the corporate level; all tax payers within each state will be covered.

“Those who have found Nigeria a fertile ground; those who have made a living and made profit from the businesses within Nigeria, we ask them to do the right thing.

“We all know the right thing to do. Most of these companies have the big names as auditors yet they keep different records — one set of records for the banks, one set of records for shareholders and one set of records for the tax administrators.

“I think it’s time that that was stopped and I am going to also request that the multinationals should follow our laws and not do things that will contravene the tax laws and I ask them that they should please partner with us and follow the laws of the Federal Republic of Nigeria, especially when it comes to tax payment.”

The Director, Communications and Liaison Department, FIRS, Mr. Emmanuel Obeta, had told our correspondent that the FIRS, in a bid to capture companies with the tax net, is currently discussing with the Corporate Affairs Commission to make it mandatory for the companies to obtain their Tax Identification Number at the point of registration.

Obeta said, “The collaboration with the CAC is still ongoing, such that the FIRS will gain an immediate access to all the data of registered companies and such companies can also obtain their TIN at the point of registration from the CAC.

“The number was obtained from a physical validation or enumeration exercise. A lot of the other registered companies are portfolio companies without visible validation of their existence at their given addresses.”
Source: PUNCH