Connect with us
Advertise With Us

EDITORIAL

Need To Bring Wealthy Tax Dodgers Into The Net

Published

on


It is on record that the bulk of taxpayers in Nigeria are salary earners who are on the Pay- As- You Earn (PAYE) platform. Few of the self-employed and even private sector operators are captured in the tax net; which explains why the internally generated revenue (IGR) profile of most of the government at all levels is abysmal at best.

That also created the challenges they face in executing development-related projects. The over-reliance on oil revenue has not, in any significant way, alleviated the problem of paucity of fund needed for the provision of social services and protection of lives and property. Hence the urgent need to widen the tax net to bring in as many eligible taxpayers as possible. In most advanced nations, tax is a major source of government funding and defaulters are treated as scoundrels.

In Nigeria, tax ought to be a strong driver of economic development, second only to oil. There are enabling laws on tax administration in the country but from available statistics, they are observed more in the breach. These include education tax Act and the companies’ income tax Act, which imposes taxes on the assessable profits on companies in Nigeria.

There is also the value added tax (VAT), a kind of consumption tax levied on all goods and services. Others are petroleum profit tax and personal income tax which are charged on the income of individuals and corporations as well as on salaries, wages, rent, interest and so on. The capital gains tax is charged on profit accumulated by companies from the disposal of properties like buildings and land.

With dwindling revenue from oil, it is only normal that focus should necessarily be on driving revenue through tax.

Taking cognizance of this, it is generally agreed that default in tax payment is at best an economic crime, considered as sabotage to the effective functioning of government. This fact justifies the concerns amongst most Nigerians each time the Federal Inland Revenue Services (FIRS) raises the alarm over billionaire tax defaulters. It has vowed to go after the bank accounts of defaulting taxpayers who are raking in billions in Nigeria but are not paying taxes.

Equally worrisome is the disclosure by the revenue agency that most of such taxpayers, who have between N1 billion and N5 billion in their accounts have no Taxpayer Identification Number, TIN, or have TIN but have not filed any tax returns. We recall that the federal government introduced a Voluntary Assets and Income Declaration Scheme (VAIDS), which served as a window of opportunity for individuals and companies to regularise their tax status.

However, it is sad to note that these defaulters, reportedly, are reluctant to take advantage of that window to do the needful and discharge their civic responsibility of paying tax and filing returns on their accounts.  It is disconcerting to see that wealthy individuals and corporate bodies fall within this category of those who are reluctant to pay tax. It is within this context that we support the move by the FIRS to go after these economic saboteurs as we believe, and rightly so, that tax defaulters are economic criminals.

We urge the FIRS to deploy every legal instrument at its disposal in going after these defaulters, and the onslaught on them should be total, without compromise. FIRS should be decisive in its approach and adopt the name and shame method by disclosing the identity of these economic saboteurs to the public so that Nigerians can ascertain their identities and treat them with disdain as they so deserve. But beyond going after these billionaires, FIRS should intensify its surveillance to include all other categories of tax defaulters by ensuring that the full weight of the law is brought to bear on all who violate the law.

It is sad that Nigeria ranks very low when it comes to taxation as its tax-to-GDP ratio is a paltry six per cent, representing one of the lowest in the world. The country records losses running into trillions in local and foreign currencies because taxable individuals and corporate institutions have reneged in their civic responsibilities.

Records indicate that about N100 billion was discovered as revenue shortfall from contractors’ tax evasion between 2012 and 2017. As a nation, Nigeria has no option but to express its commitment to changing the wrong way things are done in relation to taxation. One way of achieving this is to set an example by unleashing the full wrath of the law on these billionaire tax defaulters so as to serve as a deterrent to those wishing to follow in their line of mischief and crime.





Advertisement

You must be logged in to post a comment Login

MOST POPULAR