RMAFC discovers N115bn tax liabilities owed by FG, states MDAs.
- Federal government agencies domiciled in certain states have failed to remit Pay as You Earn (PAYE) that have accrued over the years
- 40 billion still expected to be uncovered
- Adamawa, Borno, Delta, Ebonyi, Katsina & Kebbi States given clean bill of health for tax compliance.
Recall that the Federal Inland Revenue Service has announced in 2011 that it would soon begin to wield the heavy arms of the law on government agencies over issues related to tax non-compliance; a situation that subsequently led to the arrest of Federal Capital Development Authority (FCDA) Chief, Adami Ismaila, over N28 billion unremitted taxes, a recent tax recovery exercise by Revenue Mobilisation Allocation and Fiscal Commission (RMAFC) has led to the discovery of N115, 811, 884,454.01 tax liabilities against a number of federal and states’ Ministries, Departments and Agencies (MDAs).
The local government council were also not left out of these revelations by RMAFC as they were entangled in tax liabilities as well.
He also said that N40 billion were still expected to be uncovered since the exercise is 10% away from completion. The concluding phase will have the commission shine its light on Bauchi, Cross River, Edo, Enugu and River States.
The statement further said that all states charged in this tax brouhaha has indicated their willingness to remit the liabilities and pleaded for waiver of penalty of N24,030,004,256.31comprising N9,748,742,417.28 penalty and N14,281,261,839.03 interest respectively.
The statement also included the clean health status given to Adamawa, Borno, Delta, Ebonyi, Katsina & Kebbi States as they are were tax compliant.
Ibrahim Mohammed also stated in the statement that “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 (PAYE) to the state governments thus depleting their Internally Generated Revenue (IGR) base.”
The commission also advised states like Bauchi, Cross River, Edo, Enugu and Rivers which are yet to join in the exercise to participate in the spirit of equity and fair play since they also reap from the dividends of tax proceeds remitted by other States.
My questions are:
- What is the basis for the States holding on to these funds from 2005 and why will they plead for tax penalty and interest waiver?
- Since their corporate and individual counterparts fail the full weight of the law over tax compliance issues, then they should also be made to face such sanctions as well?
What do you think?