Not a few patriotic Nigerians were amazed by the revelation of the Federal Inland Revenue Service (FIRS) that Obasanjo Farms, owned by former President Olusegun Obasanjo, is among 19, 901 consolidated tax defaulters in the country. This situation is not only regrettable but also a national embarrassment, coming from a statesman and one who was at the helm of Nigeria’s leadership for a cumulative period of eleven years, the longest in the nation’s history.
A list published by FIRS on its website last week contains other prominent individuals and organisations including Davido Music Worldwide Ltd, owned by superstar musician David Adedeji Adeleke; popular supermarket chain, Addide, Iyiola Omisore & Par; Citiroof Aluminium Co. Ltd; Coldstone Creamery Limited (Yaba); Grand Square Supermarket and Stores Ltd; Open Heavens Bliss Enterprises; God is Good Motors and a host of other publicly-quoted and privately-held businesses.
The agency said it had taken possession of the bank accounts of the tax defaulters, adding that the accounts would be under its possession until they regularise their tax status.
It said, “This is to notify all companies, which had their bank accounts placed under lien by the Federal Inland Revenue Service pursuant to Section 31 of the FIRSE Act but are yet to regularise their tax status with the FIRS, that if they fail, refuse or neglect to pay the tax due within 30 days of this notice, the FIRS shall in accordance with Section 49 (2) (a- d) of the FIRSE Act proceed and enforce the payment of the said tax against all the directors, managers, secretaries and every other person concerned in the management of the companies and recover the said tax from such persons without further notice.
“For the avoidance of doubt, the above section authorises the FIRS to proceed against and punish every officer, manager, director, secretary or any person concerned with the management of the company in like manner as if he/she had committed the offence.”
To lift the lien on the business accounts, the FIRS urged the tax defaulters to take the following steps to regularise their tax status.
These are: Make payments of applicable taxes for the period owed; Visit the closest Substitution Review Unit (SRU) to: a) Fill tax payers form as required; b) Attach evidence of tax payments made alongside the following: i. A letter to the ECFIRS on response to the substitution on your account; ii. Attach to letter a) Copy of your last file return; b) Copy of current tax clearance certificate; c) Bank statement for 3 years; d) Copy of incorporation and commencement of business.
The tax defaulters are also expected to: State sources of income if loan; or operate Bureau de Change, etc.; the SRU team will analyse and give feedback or in the alternative “send these details to [email protected].”
The FIRS had recently advertised that it would enforce the payment of whatever outstanding tax each company had against it.
The Chief of Staff to President Muhammadu Buhari, Mr. Abba Kyari, had queried FIRS chairmn Mr Babatunde Fowler over alleged discrepancies in tax collections from 2015 to 2018. A letter dated August 8, 2019, and addressed to the FIRS chairman, which was signed by Kyari, had asked Fowler to explain the ‘significant’ variances in budgeted collections and actual collections of tax in 2015, 2016, 2017 and 2018.
In the concerned years, the actual amount collected as tax had fallen below the budgeted target. In 2015, actual collection was N3.7tn, while the budgeted target was N4.5tn. A similar shortfall occurred in 2016, when actual collection was N3.307tn, less than the N4.95tn budgeted target. Also, in 2017, the FIRS collected a total of N4.027tn, less than the set target of N4.89tn.
In 2018, actual collection was N5.32tn, while the budgeted target was N6.7tn. Fowler was appointed chairman of the FIRS in August 2015, but his appointment was confirmed by the Senate in December of the same year. The query covered the period he has so far been in office.
The federal government has also announced its decision to audit FIRS and Customs’ revenues. The Office of the Auditor-General of the Federation is to conduct revenue assurance and Information Technology audit on the FIRS and the Nigerian Customs Service. The audit is part of the Fiscal Governance and Institutions Project, a collaborative programme of the federal government and the World Bank.
The project is aimed at strengthening revenue collection management and accounting processes, as well as transparency and accountability in the use of public funds, a statement on Saturday quoting the Auditor-General of the Federation, Anthony Ayine, revealed; adding that he had met the managements of the FIRS and NCS over the project.
Although tax evasion is a malaise that has been plaguing Nigeria’s economy over the decades, the Obasanjo’s case is particularly condemnable, considering the fact that the former president has cut for himself the notoriety of a regular letter writer, spewing scathing criticisms of virtually all the succeeding administrations after his in 2007. Consequently, we endorse the action of FIRS in placing a lien on the accounts of the tax evaders. FIRS should also proceed to prosecute these unpatriotic corporate citizens to serve as deterrence to others.
