FG to enhance tax administration via automatic exchange information

Federal Government through the Federal Inland Revenue Service (FIRS) is expected to enhance its tax administration system locally and internationally as Nigeria progresses to join the 101 countries to exchange financial account information automatically.
A team from the Global Forum on Transparency and Exchange of Information for Tax Purposes were in Lagos at the weekend for a seminar specifically to create awareness on automatic exchange of financial account information.
A total of 101 countries are currently committed to exchange financial account information automatically, with 50 beginning in September 2017 and followed by another round of 50 in September 2018.
These countries include all of the financial international financial centres that hold offshore assets from another countries all over the world.
Out this number, only two continental African countries are committed to the automatic exchange information – South Africa and Ghana.
Receiving the team in Lagos, Babatunde Fowler, chairman, FIRS, said Nigeria was able to within three months grow its tax base to close to 400,000.
“We also had a handshake with the Nigerian Customs on Value Added Tax (VAT) and in the last six months. I think we have been able to get an additional N118 million in terms of VAT. So, we are looking at it both within and outside the country,” Fowler said.
He was concerned that a lot of African leaders make money and invest in Europe and other African countries, and the host countries could not ask for information in terms of the source. He added that the tax payments of these individuals or organisations pose danger to the stability of the economy and also the type of investment that was accepted.
“I was in South Africa and I did find out that Nigerian and Nigerian organisations have 29 private jets registered in South Africa. Now, the issue is do they pay tax in Nigeria or do they pay there. We haven’t talked about how they got the money to buy the jet but first of all about revenue, how much tax have they paid to the government of Nigeria, their issue will be dealt with later on,” he said.
Donal Godfrey, deputy head of global forum secretariat, said, “Nigeria will get information if it were to commit to do what the automatic exchange of information, on Nigerian residents that have accounts in other countries that are participating in the automatic exchange of information system.”
Godfrey explained that to engage successfully, participating member countries will need to have legislation, which requires “your own bank report information and foreign residents who have account in Nigeria, you need to have international agreements which allows you to exchange information with your credit partners, you need to have IT systems and support within the tax administration and you need to ensure that information you received is going to be used properly and kept confidential.
“Nigeria already some of these requirements in place. It has the capacity to do all of these and has the potential to make commitment to 2019”.

 

Hope Moses-Ashike