Representatives Summoned Federal Inland Revenue Service (FIRS) To Investigate ‘$30 Billion In Tax Leakages’

The joint committees on finance, banking, and currency of the House of Representatives have launched an investigation into tax leakages that cost the federal government $30 billion between 2005 and 2019.

Revenue remittance into the federation account has been a source of worry.

The examination targets agencies and enterprises in banking, oil exploration, engineering, procurement, building, installation, marine transportations, manufacturing, and telecommunications, according to Abiodun Faleke, chairman of the finance committee, who spoke during a hearing on Monday.

According to Faleke, the joint committee also discovered irregularities in “the inflow of foreign investments, such as equity, foreign cash loans, and equipment loans, whose utilisations are primarily taxed, end up in transactions, foreign transfers that were at odds with the purpose of such inflows.”

“Overnight and fictitious disappearance of Naira proceeds of foreign inflows from Nigerian beneficiaries’ bank accounts, and subsequent allocations of foreign exchange by the CBN for capital repatriations, principal loan repayments, and interest payments,” he stated.

“Excessive foreign exchange allocations to holders of foreign inflow Certificates of Capital Importation (CCI) over and above the amount brought into the country, resulting in capital flight of the country’s desperately needed and scarce foreign exchange.

“Some anticipated imports that were funded by foreign equipment loans and other direct allocations of foreign exchange for foreign exchange valid transactions were neither translated into imports nor paid to the Nigerian Customs Service.”

Citibank was also questioned by the committees for neglecting to deposit money from tax revenues into the federation account.

“The supporting documents are more concerning to me. It’s not a question of whether you’ve done something or not. It’s all about the supporting documentation and what the government should have gotten in terms of taxes. That is the crux of the study, according to Faleke.

“If the government was supposed to benefit N100 million, has it benefited that N100 million? What of your firms is still liable, hasn’t paid, or hasn’t had the tax deducted?”

Citibank’s director of operations, Ngozi Omoke-Enyi, disputed the allegations, claiming that the bank followed all financial standards in all of its transactions.

“We have reviewed all of the allegations and transactions detailed in the report that was sent to us, and we want to reiterate that we did not violate any of the Act’s or the Foreign Exchange Manual’s guidelines,” she added.

The bank, on the other hand, was given seven days to present evidence and records to back up its assertions, according to the committee.

Fidelity Bank was also questioned about income leakages by the panel, but Imam Hassan, executive director, north, denied wrongdoing.

The chairman of the committee ordered that the Federal Inland Revenue Service (FIRS) come before the panel to explain the facts surrounding the enterprises’ unremitted tax revenue.