NASS, MDAs failed to remit N5.8bn in taxes deducted – Report
Report by the Office of the Auditor General of the Federation (OAGF) has revealed that the Federal Inland Revenue Service (FIRS) lost tax revenue amounting to N5.8bn in 2019 as a result of non-remittance of tax deductions by ministries, departments and agencies (MDAs) of government, in addition to those by the two chambers of the National Assembly.
The OAGF’s 2019 Annual Report on non-compliance, internal control, and weakness issues in MDAs of the government for the year ended December 31, 2019 indicted the Senate, the House of Representatives, and the National Assembly Service Commission.
The MDAs include; Federal Ministry of Agriculture and Rural Development, Federal College of Freshwater Fisheries Technology, New Bussa, Advertising Practitioners Council of Nigeria (APCON), Nigerian Civil Aviation Authority (NCAA), Nigerian Communications Satellite Limited, Hussaini Adamu Federal Polytechnic, in Jigawa State; Federal Medical Centre (FMC), Keffi, Nasarawa State, Department of Petroleum Resources, National Assembly Service Commission, and Nigerian Correctional Service.
According to the report, between 2018 and 2019, the MDAs failed to either remit one per cent stamp duty, Value Added Tax (VAT), Withholding Tax (WHT) or Pay As You Earn tax (PAYE) deducted from awarded contracts, thereby contravening sections of the Financial Regulations and Treasury Circular issued on December 29, 2015.
According to the report, Paragraph 234(I) of the Financial Regulations states that ‘it is mandatory for accounting officers to ensure full compliance with the dual roles of making provision for the Value Added Tax and withholding tax due on supply and services contract and actual remittance of same’.
It quoted Paragraph 235 as saying, “Deduction of VAT, WHT, and PAYE shall be remitted to Federal Inland Revenue Service at the same time the payee who is the subject of deduction is paid.”
The report further quoted the Treasury circular Ref No. TRY/A12&B12/2015 and OAGF/CAD/VOL.II/390 and dated December 29, 2015 as stating that; “1% Stamp Duty chargeable on contract awards and the remittance be made to the relevant tax authority (Federal Inland Revenue Service).”
“The audit observed that the sum of N5,828,621,715.06 was the amount of taxes not remitted by 12 Ministries, Departments and Agencies.
“The Nigerian Civil Aviation Authority has the highest amount of N2,984,887,250.00 while Federal College of Freshwater Fisheries Technology, New Bussa has the least amount of N1,021,011.13.”
