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Nigeria, Others Lose $80bn To Illicit Financial Outflows Annually



Former President of South Africa, Thabo Mbeki, yesterday disclosed that Nigeria, South Africa and other African countries lose an estimated amount of $80 billion to illicit capital outflows every year. Mbeki also called for urgent kick against the illicit financial loss and its resultant cut on public wealth by the global community. He made the remarks as the guest speaker at the African Union high level panel on illicit financial flows from Africa held in Abuja, yesterday. Also speaking at the continental meeting, chairman of the Federal Inland Revenue Service (FIRS), Mr Tunde Fowler revealed that the FIRS has finalised its findings over some plots of land belonging to 114 companies who denied ownership of the said plots scattered around the federal capital territory.
Mr Fowler said whereas the companies have consistently denied ownership of the land properties, the revenue agency has confirmed from the Abuja Geographical Information System (AGIS) that these lands were actually allocated to these companies and the Service has vowed to hand over these false claims to the Attorney General of the Federation for further action on the controversial lands.

“114 Companies claimed they were unaware of land allocated to them but AGIS has confirmed the ownership for all the cases referred to them and we will soon hand these cases over to the Attorney General on the way forward,” Fowler said.Mr Fowler also disclosed that the revenue agency has recovered the total tax debt of N3,631,949,050 from January 2017 to 31st August 2018. A breakdown of figures shows that between November 2016 and December 2017, the total sum of N1.9 billion was collected, while another N1.731 billion was recovered from January 2018 to date. He said the recoveries underscores the benefits of curbing illicit financial flows in Nigeria in particular, which he said has become a major concern because of the scale and negative impact of such flows on Africa’s development and governance agenda.

With regards to the issuance of tax notification obligation to Company Income Tax (CIT) Non-Compliant Companies that own properties and Identified Non-Filers for Abuja, Fowler stated that it issued 2,672 Demand Notices; 653 those Now Filing and N2.983Billion as total payments for Demand Notices for Abuja Properties He identified the Component of Illicit Financial Flows in Nigeria to include: Commercial Activities which are illegal flows from business activities that leads to hiding wealth, evading or aggressively avoiding tax, and dodging customs duties and domestic levies; Criminal activities: IFFs are often driven by criminal activities with the purpose of keeping the transactions from the view of law enforcement agencies or revenue authorities; Corruption: Money acquired through bribery and abuse of office by public officials are enormous and can be used to further develop different projects, and also increase taxation revenue collection.

On her part, Minister of Finance, Mrs. Zainab Ahmed applauded efforts of the members to fight what she called hydra-headed plague of illicit financial flows. “IFFs have robbed Africa of the wealth and resources needed to invest in infrastructure, education, hospitals, electricity and many other necessities for sustainable and inclusive economic development,” she stated.
Mrs Ahmed noted that the quest for Africa’s economic development will be accelerated if funds illegally acquired, stolen and hidden abroad by illicit finance flow perpetrators are repatriated. “Our development will no doubt receive a leap if multinational Corporations desist from illicit activities of aggressive transfer pricing, base erosion, profit shifting and trade mispricing.
“The challenge of combatting IFFs is particularly pronounced in countries such as Nigeria, due to the dominance of the extractive industries in the economy. “In this regard, the work of the Nigeria Extractive Industries Transparency Initiative (‘NEITI’ – which I used to head) as well as the Federal Inland Revenue Service (whose operations the Ministry of Finance oversees), are relevant.





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