Government moves against corporate tax evaders

The Federal Executive Council on Wednesday gave its nod to the move by the Federal Inland Revenue Service to strengthen non-oil tax and revenue collection.

It also awarded contracts for five road projects totalling N42bn.

Ministers, who briefed State House correspondents on the outcome of the meeting presided over by President Goodluck Jonathan, included Mr. Labaran Maku (Information); Dr. Ngozi Okonjo-Iweala (Finance); Mr. Mike Onolememen (Works) and Mrs. Omobola Johnson (Communication Technology).

Okonjo-Iweala said the council approved the move by the FIRS to strengthen non-oil tax and revenue collection because the Federal Government’s drive to strengthen the economy through non-oil sector was yielding results.

She said this was meant to plug the loopholes in the system.

The minister said the approach would see the tax to Gross Domestic Product currently put at seven per cent increasing to 22 per cent.

She said the new strategy that would see an international firm, McKinsey and Company, providing technical support for non-oil revenue enhancement and capacity building to the FIRS would target the 65 per cent of registered corporate tax payers, who had not filed returns in the last two years.

It would also capture 75 per cent of the medium and small businesses currently in the tax system but were not paying taxes and about 30 per cent firms operating under pioneer status and using the incentives to evade tax payment.

In order to tackle this, the minister said the firm suggested five strategies to the FIRS; these are: improved audit, tax filing enforcement, review of tax holidays and exemption, tax arrears and debt enforcement, increased registration of companies and improved external communication.

The FIRS targets about N2.2tn of non-oil tax revenue in 2014.

According to the minister, the involvement of the consultant will take in additional N75bn.

Onolememen said that contracts for the five road projects totalling N42bn were awarded by the council.

According to the minister, the contract for the rehabilitation of Ilorin-Jebba-Mokwa-Birnin-Gwari-Kaduna Road, Section 1, which is Ilorin-Jebba Road in Kwara State, was awarded at the sum of N14.5bn with completion period of 24 months.

He added that the council also approved the award of a contract for the rehabilitation of Mubi- Maiha- Sorao Road with spur from Mubi-Bukula in Adamawa State in the sum of N2.99bn with a completion period of 18 months.

He said the council approved the award of a contract for the rehabilitation of the Ilorin-Omuaran-Kabba Road in Kwara/Kogi states in the sum of N8.2bn with a completion period of 36 months.

According to the minister, the council approved the award of a contract for the dualisation of Kano-Katsina Road Phase 1: Kano town at Dawanau roundabout, Katsina State border in Kano State in the sum of N14bn with a completion period of 30 months.

He said the council approved the award of another contract for the rehabilitation of Tumu-Pindiga-Kashere (Gombe State)- Futuk-Yalo (Bauchi State) Bashar-Dengi (Plateau State road: construction of Yalo-Bashar-Dengi Section) in Bauchi State/Plateau State, in the sum of N3bn with a completion period of 18 months.

 

 

[Punch]