Unremitted Taxes Hit N212bn, Says FIRS

The Federal Inland Revenue Services (FIRS) yesterday revealed that unremitted tax revenues from some government Ministries, Departments and Agencies (MDAs), as well as other private firms in the country, has increased from N64 billion in 2006 to N212 billion in 2010.

The FIRS made this revelation at a meeting in Abuja with directors of finance and accounts of MDAs where they dialogued on the best way to encourage voluntary tax compliance, as well as solicit support to build trust and confidence in the system.
Coordinating Director of Tax Operation Group Mr. Samuel Ogungbesan stated that the gathering was sequel to its January meeting with permanent secretaries in the ministries where issues of practical tax administration were discussed.

He also explained that private firms in the country have contributed 27 per cent of failed remittances. Inability of the MDAs to remit Withholding Tax (WHT), Value Added Tax (VAT) as well as, Pay As You Earn (PAYE) deducted at source to FIRS-designated collecting bank accounts contributes the remaining percentage of un-remitted taxes, he revealed.
The FIRS discovered that most of the culpable MDAs have often failed to build in VAT in the initial financial analysis of projects they award to contractors but deduct the VAT upon payment of contract sums in shortchange of the contractors.

Ogungbesan said that modalities are being worked out to exclude government from paying VATs on contracts. He explained that the FIRS is committed to ensuring that the policy framework and legal aspects of tax administration in the country are harmonized to avoid these incidents.
He added that the MDAs that have contributed to unremitted arrears are shortchanging the system and other MDAs that have continually contributed to the national revenue basket.
Ogungbesan solicited the support of the account officers within the MDAs to minimize the cost of tax compliance and administration. The intervention, according to him, will ensure proper implementation of tax laws.

“When you deduct and don’t remit to the revenue basket, the result is what we experience today - backlog of unremitted tax and you will wonder what the FIRS has been doing all these while to allow us get to this stage. But we are working to provide Nigerians with an enduring tax system," he stated.
The proposed tax compliance desk officers will be saddled with the responsibility of ensuring easy tax administration and compliance; they are expected to intimate the FIRS with developmental reports.