By Daniel Kanu (Assistant Politics Editor)
Overseas bank accounts and other assets held by Nigerians are being collated into a database in Abuja, supplied by the United Kingdom and other countries in the Automatic Exchange of Tax Information (AETI) scheme.
Finance Minister, Kemi Adeosun, confirmed this on Friday, February 2, in Abuja at the presentation of the progress report on Tax Laws Reform by National Tax Policy Implementation Committee Vice Chairman, Taiwo Oyedele.
Adeosun expressed satisfaction with the data being supplied by foreign countries under the AETI Nigeria signed up to in January 2018.
“The data received in Nigeria with regard to overseas assets held by Nigerians has been impressive and will underpin a long term improvement in the nation’s tax to Gross Domestic Product (GDP) ration, and in turn, will improve life for the masses,” she said.
“The data on bank accounts, property and trusts, which has come automatically from a number of countries is being used to support the Voluntary Assets and Income Declaration Scheme (VAIDS) by allowing the tax authorities to check the accuracy of declarations received.
“The Federal Government is also using the data to generate ‘nudge’ letters which are being sent to those identified as being potential tax defaulters.”
She disclosed that Nigeria has written to some countries to request specific information about offshore trusts and bank accounts held by its citizens.
She advised users of offshore structures to take advantage of VAIDS to regularise their taxes before the amnesty expires.
“The offshore tax shelter system is basically over,” she announced.
Those who have “hidden money overseas are being exposed, and whilst Nigerians can legally keep their money anywhere in the world,” Adeosun stressed, “they must first pay any taxes” so Abuja can fund social facilities, and create jobs and wealth.
“The moral argument against illicit financial flows and tax evasion and the strong international co-operation are such that every Nigerian tax payer should do the right thing.
“The needs of our people for development override any other argument against payment of tax.”
Adeosun canvassed sustainable revenue that could deliver infrastructural development and improve tax to GDP ratio.
The government wants to build a robust tax system and implement the recommendations by the National Tax Policy Implementation Committee (NTPIC) on tax laws reform.
In making the recommendations, Oyedele disclosed, the NTPIC considered three major policy documents namely – Economic Recovery and Growth Plan (ERGP), National Tax Policy, and Ease of Doing Business Plan.
The NTPIC agreed that tax reforms should align with overall government objectives as articulated in these documents, such that every action or recommendation would promote and help realise overall objectives.
It identified seven major tax areas with the highest impact as
• Company Income Tax (CIT)
• Value Added Tax (VAT)
• Customs & Excise Tariff (CET)
• Personal Income Tax (PIT)
• Pension Contributions
• Industrial Development Income Tax Relief (IDITR)
• Tertiary Education Trust Fund
Oyedele, who represented NTPIC chairman, expressed optimism that the proposed changes to the tax laws will
• Increase and diversify Government revenue
• Simplify paying taxes and doing business
• Promote micro, small and medium enterprises
• Protect most vulnerable persons in the society
• Remove obsolete, ambiguous, and contradictory provisions in the law
The work of the NTPIC led to two executive orders – Value Added Tax Act (Modification) Order and Review of Goods Liable to Excise Duties and Applicable Rate Order.
It also led to five proposed bills – Companies Income Tax Act (Amendment) Bill, Value Added Tax Act (Amendment) Bill, Customs, Exercise, Tariff (Consolidation) Act (Amendment) Bill, Personal Income Tax Act (Amendment) Bill, and Industrial Development (Income Tax Relief) Act (Amendment) Bill.
