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MDAs owe N115bn in tax liabilities

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Image result for Head of Public Relations, Mr. Ibrahim Mohammed.Ministries, Departments and Agencies of the federal and state governments owe over N115bn in tax liabilities, the Revenue Mobilisation Allocation and Fiscal Commission has said.

The RMAFC said this in a statement made available to our correspondent in Abuja on Wednesday by its Head of Public Relations, Mr. Ibrahim Mohammed.

Mohammed said the commission uncovered the amount being in tax liabilities established against federal and states’ MDAs as well as local government councils across the country following a tax liability recovery exercise carried out by it.

He said, “The commission was able to establish the sum of N115,811,884,454.01 as tax liabilities in the first phase of the exercise covering the period between 2005 and 2015 spread across 30 states of the federation with the exemption of Adamawa, Borno, Delta, Ebonyi, Katsina and Kebbi states, which were given a clean bill of health as they had no tax liabilities.

“At the end of the exercise, which is 90 per cent completed, an additional sum of N40bn is expected to be realised.”

Mohammed added, “All the states, LGs and other agencies so far covered have passionately pleaded for waiver of penalty and interest totalling N24,030,004,256.31, comprising N9,748,742,417.28 as penalty and N14,281,261,839.03 as interest, respectively.

“In the course of the exercise, it was discovered that some Federal Government agencies domiciled in the states were not remitting Pay as You Earn assessment to the state governments, thus depleting their Internally Generated Revenue base.”

The RMAFC called on the Federal Government to reimburse some of the state governments that executed projects for it in their states so as to enhance their revenue profile.

The commission also urged states like Bauchi, Cross River, Edo, Enugu and Rivers, which had yet to be verified, to subject themselves to the exercise in the spirit of equity and fair play since they continued to enjoy the proceeds of tax remitted by their counterparts.

With dwindling government revenues resulting from low patronage of the nation’s foreign exchange earner, crude oil, as well as the diminishing price of the commodity, the government has increased strategies to earn more from taxes.

Tax evasion is considered to be high and widespread among individuals and corporate entities in the country, with Acting President Yemi Osinbajo recently signing an Executive Order granting amnesty to tax evaders.

The Executive Order established the Voluntary Assets and Income Declaration Scheme that encourages tax defaulters to voluntarily show up and pay up without being prosecuted.

The amnesty, which runs from July 1 to March 31, 2018, hopes to bring in four million defaulters into the tax database to boost government revenues.

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