The Federal Inland Revenue Service, FIRS, says it has sealed off over 3,000 properties in the Federal Capital Territory, FCT, Abuja for failing to file annual tax returns.
The Chairman of FIRS, Babatunde Fowler, disclosed this at a one-day media sensitization workshop on Voluntary Assets & Income Declaration Scheme, VAIDS, on Thursday in Abuja.
Mr. Fowler, who represented the Minister of Finance, Kemi Adeosun, said the affected properties, which belong to individuals and corporate organisations, were sealed off since the VAIDS tax amnesty policy programme was launched last July.
“We have waited for the owners of these properties to come forward and regularize their records. Very soon we would be going to court to seek permission to dispose of these properties. Whatever is realized would be to make up for the outstanding liabilities. If any change is left we give it to the owners,” Mr. Fowler said.
Besides, he said there were properties built and owned in the country under corporate names, without those organizations paying appropriate taxes to government. All those properties, including empty land or properties are currently being reviewed.
He said, by law, if owners of such corporate organisations do not file revenue returns or pay corporate tax, the FIRS has adopted a policy of calculating tax returns on 20 per cent of the company’s annual turnover.
“For a company to own a property, there must be that money came from some source. For an individual, it also works the same way. An individual who earns N10 million annual salary, but owns property valued at N100 million will have to pay tax on the difference in amount, because the excess money must have come from somewhere,” the FIRS Chairman explained.
On the impact of the recent government policy to invite to privileged Nigerians to voluntarily regularize their tax statuses, Mr. Fowler said about N17 billion had been realized from five companies, with additional N6 billion expected to be paid before the end of December.
He urged Nigerians to take advantage of the nine months amnesty window to regularize their tax status and avoid the fine that would follow after the March 2018 deadline.
“Those who do not take advantage of the opportunity would be made to pay a fine at the expiration of the amnesty window, because there must be an incentive for those who come forward to pay voluntarily,” he said.
Part of the incentives include that government would not investigate or prosecute those who willingly embraced the VAIDS programme, so far as the FIRS was convinced what they declared were truthful and genuine.
Although he said the VAIDS programme had recorded significant progress since it began, the FIRS boss said it still has not met a crucial number as was expected.
He solicited the cooperation of judges in the prosecution of the tax cases in court to be brought before them, not just because they are Nigerians, but because their rulings would help enforce and uphold the rule of law.
“The FIRS is not trying to pull the judges to government side, just because we want to increase tax revenue, but to ensure that every taxpayer sees that as long we do our job the right way, we will certain win our cases,” he said.
To sensitize the judges, he said the FIRS had some legal information, it believes, if they apply would help them discharge their obligations effectively.
A member of the Presidential Committee on the VAIDS, who is also a consultant to FIRS and Fellow of the Institute of Chartered Accountants of Nigeria, ICAN, Albert Florunsho, said the tax amnesty programme was not introducing any new tax policy in the country, but to encourage tax payers comply with existing tax laws.
Mr. Florunsho, who made a presentation on “VAIDS: A Tax Amnesty Programme in Action”, said although the programme was not asking religious organizations to pay tax, it did not also grant exemptions to such people who earn incomes and involve in businesses that earn income from tax.
“No clergyman or church is asked to come and pay tax. But, if any of them is engaged in business, the income from the business would be liable to tax. There is no exemption in the tax law for clergymen and religious leaders.
“This not a call for churches to begin to pay tax from their tithes and offerings. But, if they have a school, depending on how it is set up, or any other such business, outside its religious ecclesiastical activities, like printing press that does printing for other members of the public, and not of a public character, is liable to income tax,” Mr. Florunsho said.
The Executive Secretary, Joint Tax Board, JTB, Oseni Elamah, in his contribution said government was concerned that corporate organizations, particularly media houses, were not remitting tax deductions from their workers to the tax authorities.
He said government was considering a policy that would not allow corporate organization to be cleared to make their annual returns, if there were no records that tax deductions from their workers have been remitted to the relevant tax authorities and tax certificates issued.