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FG’ll Prosecute Tax Defaulters Who Shun VAIDS – Adeosun

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Kemi adeosun
  • FG’ll Prosecute Tax Defaulters Who Shun VAIDS – Adeosun

The Minister of Finance, Mrs. Kemi Adeosun, on Tuesday said that the Federal Government would prosecute tax defaulters who fail to take advantage of the nine-month amnesty period offered under the Voluntary Assets and Income Declaration Scheme.

The VAIDS was established on June 29, 2017 via an Executive Order signed by Vice President Yemi Osinbajo, who was then Acting President, as a broad spectrum solution to virtually all the defects in the country’s tax system, including negativity towards taxation.

The first phase of VAIDS runs from July 1, 2017, while the second phase ends on March 31, 2018.

According to her, sanctions await defaulters who refuse the Federal Government’s offer of amnesty, including the full payment of outstanding tax liabilities and criminal prosecution.

She stated that businesses, which untruthfully comply, would be liable as whatever was paid on the declared liabilities would be considered as part-payment of the outstanding sums later discovered by the authorities.

Adeosun advised Nigerians to review any existing tax planning schemes, including those in offshore tax havens, in order to take advantage of the VAIDS to regularise their tax status where necessary.

She stated that while the use of tax avoidance schemes was legal, tax evasion was not.

Adeosun said, “The critical question to be asked of all Nigerian taxpayers using offshore tax shelters will be whether all applicable taxes have been paid prior to the transfer of funds or assets to a tax shelter.

“If all taxes had been paid, then there will be no additional liability except tax payable on further income earned on those funds. However, if taxes had not been paid, then the use of such schemes is illegal.”

She urged users of offshore tax shelters to promptly embrace the VAIDS scheme to regularise their status, adding that Nigeria’s low tax revenues were at variance with the lifestyles of a large number of its citizens and with the value of assets known to be owned by Nigerians resident around the world.

The minister added, “The VAIDS ushers in an opportunity to increase the nation’s general tax awareness and compliance. It is a time-limited opportunity for taxpayers to regularise their tax status relating to previous tax periods.

“In exchange for fully and honestly declared previously undisclosed assets and incomes, taxpayers will benefit from forgiveness of overdue interest and penalties, and with further assurance that they will not face criminal prosecution for tax offences or be subject to tax investigations.”

Adeosun explained that with the increasing global focus on illicit financial flows and tax evasion, offshore tax shelters no longer offered robust protection against tax authorities.

She added that the continued use of such schemes posed enormous risks for the users.

Meanwhile, the Voluntary Assets and Income Declaration Scheme Office has launched a video campaign to create awareness about the programme, promote voluntary tax compliance and boost tax education among Nigerians.

This was disclosed in a statement by the initiator of the programme, the VAIDS Office domiciled in the Federal Ministry of Finance.

According to the statement, the campaign on YouTube at bit.ly/VAIDSVideos, features short videos and skits depicting various scenarios of persons attempting to evade their taxes.

By its provision, the VAIDS gives tax defaulters a time-limited opportunity to regularise their tax affairs by truthfully declaring and paying outstanding liabilities.

The VAIDS was conceived by the Federal Ministry of Finance in collaboration with federal and state tax authorities to correct the defective tax orientation in the country and reflects the desire of the Federal Government to widen the tax net, while offering benefits to defaulters, who voluntarily and truthfully declare their assets and pay tax liabilities.

Benefits accruable to individuals and corporate bodies, who comply with the VAIDS include immunity from prosecution, tax audits as well as waivers of interest and penalties on unpaid taxes. They also include the option of spreading outstanding liabilities over a maximum period of three years as may be agreed with the relevant tax authorities.

Is the CEO/Founder of Investors King Limited. A proven foreign exchange research analyst and a published author on Yahoo Finance, Businessinsider, Nasdaq, Entrepreneur.com, Investorplace, and many more. He has over two decades of experience in global financial markets.

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Economy

Nigeria’s Plan to Review Oil Companies’ Gas Flaring Strategies

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Oil

Nigeria is ramping up its efforts to address environmental concerns in the oil and gas sector with a comprehensive plan to review gas flaring strategies of international and indigenous oil companies.

The Minister of State for Environment, Dr. Iziaq Salako, announced this initiative during a national stakeholders engagement meeting on methane mitigation and reduction held in Abuja, Investors King reports.

Gas flaring, a common practice in the oil industry, releases methane—a potent greenhouse gas—into the atmosphere, contributing to climate change and posing health risks to communities near oil facilities.

Nigeria aims to end routine gas flaring by 2030, aligning with global climate goals and commitments.

Dr. Salako explained the importance of reducing methane emissions and highlighted the detrimental effects on public health, food security, and economic development.

He outlined practical steps being taken to tackle methane emissions, including the development of methane guidelines and the engagement of government institutions.

The ministry, through the National Oil Spill Detection and Response Agency, will conduct periodic reviews of oil companies’ plans to ensure compliance with the gas flaring deadline.

Deloitte management consultants will assist in conducting comprehensive forensic audits to scrutinize the legitimacy of forward-contracted transactions.

President Bola Tinubu’s commitment to environmental sustainability underscores the government’s dedication to addressing climate change and fulfilling its multilateral environmental agreements.

The engagement event served as a platform for stakeholders to discuss methane mitigation strategies, existing policies, and implementation challenges.

Collaboration and dialogue among diverse sectors are crucial in charting a unified course towards sustainable methane reduction in Nigeria’s oil and gas industry.

As the country navigates its environmental agenda, ensuring accountability and transparency in gas flaring practices remains paramount for achieving a greener and healthier future.

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Economy

Interest Rate Jumps to 24.75% as CBN Takes Aggressive Stance Against Inflation

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Dr. Olayemi Michael Cardoso

The Central Bank of Nigeria (CBN) has announced a significant increase in the monetary policy rate, known as the interest rate, to 24.75%.

This move disclosed by CBN Governor Olayemi Cardoso during the 294th Meeting of the Monetary Policy Committee press briefing in Abuja, represents a bold step by the apex bank to address the mounting inflationary pressures faced by the country.

With inflation soaring to 31.70% in February, the CBN aims to moderate this upward trend by tightening its monetary policy stance.

This decision follows the previous hike in the interest rate to 22.75% in February, showcasing the CBN’s commitment to combatting inflationary forces.

While the bank opted to maintain the Cash Reserve Ratio at 45%, the significant increase in the interest rate underscores the urgency of the situation and the need for decisive action.

Governor Cardoso emphasized that these measures are essential to stabilize the economy and safeguard the purchasing power of the Nigerian currency.

The 294th MPC marks the second meeting under Governor Cardoso’s leadership, indicating a proactive approach to addressing economic challenges.

The next MPC meeting is scheduled for May 20th and 21st, 2024, highlighting the ongoing commitment of the CBN to navigate Nigeria’s economic landscape amidst inflationary pressures.

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Economy

Nigeria Braces for 10th Consecutive Interest Rate Hike by Central Bank

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Central Bank of Nigeria (CBN)

As Nigeria grapples with persistently high inflation, the Central Bank of Nigeria (CBN) is gearing up to implement its tenth consecutive interest rate hike in a bid to curb the soaring prices and attract investment.

Analysts surveyed by Bloomberg are anticipating a substantial 125 basis-point increase in the key rate to 24%, marking one of the most significant adjustments in the current tightening cycle.

The decision, expected to be announced by Governor Olayemi Cardoso on Tuesday at 2 p.m. in Abuja, comes on the heels of inflation accelerating to 31.7% in February, far surpassing the central bank’s target range of 9%.

This surge has been primarily attributed to the sharp depreciation of the naira, prompting authorities to devalue the currency twice since June to narrow the gap with the unofficial market rate and encourage investor confidence.

While these measures have seen the naira strengthen in recent days and bolstered investment inflows, including a fourfold increase in overseas remittances and significant foreign investor portfolio asset purchases, there remains a palpable need for more decisive action.

Giulia Pellegrini, a senior portfolio manager at Allianz Global Investors, emphasized the necessity for the CBN to intensify its tightening efforts to regain foreign investors’ confidence in the local bond market.

While acknowledging the positive strides made by the central bank, Pellegrini stressed the importance of a more assertive approach to prevent the diversion of investor attention to other frontier markets.

As the Nigerian economy navigates through these challenging times, the impending interest rate hike signals the CBN’s determination to address inflation head-on and foster a more stable economic environment.

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