FG Considers Deducting Unremitted Taxes by States from Monthly Allocations

N700bn collected as tax in 2016
Damilola Oyedele in Abuja
The federal government is considering the option of deducting taxes unremitted to the Federal Inland Revenue Service (FIRS) by states from their monthly federal allocations.

Twenty per cent of Value Added Tax (VAT) and withholding tax collected by states on behalf of the FIRS, remain unremitted to the revenue collector.

The Chairman of the FIRS, Mr. Babatunde Fowler, said these when he appeared before the House of Representatives ad hoc committee investigating the accounting procedure of the FIRS on Tuesday, when he added that over 100,000 companies operating in Nigeria have never paid any tax.

Fowler also disclosed that N700 billion has been collected as taxes so far in 2016, out of the targeted N2 trillion, with 363,000 tax payers captured since the beginning of this year.

The committee chaired by Hon. Michael Enyong Okon, heard that starting from May 2, 2016, all Ministries, Departments and Agencies (MDAs) are to remit VAT and WHT deducted from contract payments into the Consolidated Revenue Fund (CRF).

The FIRS boss presented to the committee a list of companies in various sectors of the economy,  which are highly indebted in taxes, for further legislative action.
He however disclosed that some of the tax defaulters are already in talks with the FIRS to work out repayment plans for the outstanding taxes.

Fowler also noted that there are ongoing plans for the recruitment of 1,250 staff  and 1,000 auditors for enforcement of tax policy and audit compliance in the country.

The committee members directed the FIRS to provide the approval of the Federal Executive Council (FEC) for certain waivers to construction companies, and the list of the beneficiaries.
The committee also urged Fowler to push for amendment of knotty sections of the FIRS Act, as well as the measures that would assist its work.

The Chairman of the ad hoc Committee, Okon, disclosed that the Minister of Finance, Mrs. Kemi Adeosun, would be invited to appear next week for disregard of some sections of the FIRS Act.