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FG Vows to Expose Property, Bank Accounts of Tax Debtors

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Evaluation of Public Accountability and Tax Culture among Tax Payers in Nigeria
  • FG Vows to Expose Property, Bank Accounts of Tax Debtors

The federal government Thursday in Enugu State declared that it had compiled data on property, bank accounts, shareholdings and other income sources of individuals and corporate entities, warning that there would be unsavoury consequences for those who failed to regularise their tax status.

Minister of Finance, Mrs. Kemi Adeosun, spoke at the commencement of the sensitisation campaign on the Voluntary Assets and Income Declaration Scheme (VAIDS), a new tax policy of the federal government.

Adeosun advised the state residents, the business community and other wealthy Nigerians to take advantage of VAIDS to regularise their tax status and escape embarrassment from the government.

The state government hosted the event, which was attended by the state Governor, Ifeanyi Ugwuanyi; members of the state executive Council, the state legislators and traditional rulers as well as Chairman of the Federal Inland Revenue Service (FIRS), Mr. Tunde Fowler, who was represented by the Executive Secretary, Joint Tax Board (JTB), Sir Oseni Elamah.

Also present were representatives of the business community in the state, including Enugu Chamber of Commerce, Industry and Agriculture; Nsukka Chamber of Commerce, Industry, Mines and Agriculture; bank executives, lawyers, traders, electronic dealers, hospital owners, school owners and transport owners associations.

Adeosun said VAIDS was conceived to allow Nigerian companies and individuals to voluntarily do what is right for the country by coming forward to declare their assets for proper tax evaluation.

According to her, “From our records, there seems to be a few rich people from this part of the country who may need to think very carefully about making a VAIDS declaration. We have been compiling data on property, bank accounts, share holdings and other sources that suggest that many people have not been paying the right taxes. VAIDS is an opportunity to regularise.”

According to her, it would be difficult for the federal government to address the huge infrastructural deficit in the country without the people taxes, noting that huge sums of money have been moved out of Nigeria without the owners paying a kobo in tax.

“The good news for government, which is bad news for the tax evaders, is that globally, countriess have agreed to share data under the Automatic Exchange of Information. This means that while sitting on our desks in Abuja, we are getting information about assets that the owners thought were well hidden from the tax authorities.

“As you know, Nigerians are entitled to keep their wealth anywhere in the world, including under their mattress, but what the law requires is that they pay tax on their income as they earn it,” the minister added.

Nigeria, she stated, has a very poor scorecard in tax payment, noting that “when oil came, we abandoned the old systems of tax collection that provided most of our infrastructure since the colonial days.

“Currently, we have just 14 million taxpayers out of 70million, who are economically active. So many people who should be paying are not paying anything. Incidentally, we have 74million registered voters.

“Also, some who are paying tax are not paying the correct amount. It may seem smart for a businessman to go and get a tax clearance certificate for N200,00 when he earns millions, but I can tell you without fear of contradiction that not only is this illegal, but such people are cheating themselves and future generations.”

In his remarks, the state Governor, Ugwuanyi, appealed to the finance minister to ask federal government establishments in the state to pay the state government huge withholding tax debts owed the state. The state governor pledged the cooperation of the state government to ensure the success of the new tax scheme, noting that it would also boost the state’s internally generated revenue (IGR).

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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Crude Oil

Oil Prices Slip as Japan’s Rising Inflation Signals Rate Hikes

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Crude oil fell in early trading on Friday as concerns over sustained high interest rates in both Asia and the United States weighed on the outlook.

This trend is attributed to Japan’s increasing inflation, which is prompting expectations of imminent rate hikes by its central bank.

Brent crude edged declined by 11 cents to settle at $85.60 per barrel while the U.S. crude oil declined by 9 cents to $81.20 per barrel.

Recent data revealed that Japan’s core consumer prices rose by 2.5% in May compared to the same month last year. This increase marks a growth from the previous month, suggesting that the Bank of Japan is likely to raise interest rates in the upcoming months to curb inflation.

In the United States, data released on Thursday showed a decrease in the number of new unemployment claims for the week ending June 14, indicating continued strength in the job market.

This persistent robustness in employment raises the likelihood that the U.S. Federal Reserve will maintain higher interest rates for a longer period.

Higher interest rates typically have a dampening effect on economic activity, which can subsequently reduce oil demand.

The prospect of prolonged elevated interest rates in two major economies has therefore put downward pressure on crude oil prices.

Despite the downward trend, oil prices received some support from the latest figures from the Energy Information Administration (EIA).

The data showed a drawdown in U.S. crude inventories by 2.5 million barrels in the week ending June 14, bringing the total to 457.1 million barrels. This exceeded analysts’ expectations, who had predicted a 2.2 million-barrel reduction.

Also, gasoline inventories fell by 2.3 million barrels to 231.2 million barrels, contrary to forecasts that anticipated a 600,000-barrel increase.

“Gasoline finally came to life and posted its first strong report of the summer driving season,” remarked Bob Yawger, director of energy futures at Mizuho in New York, highlighting the surprising uptick in gasoline demand.

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Crude Oil

Nembe Creek Oil Field Halted After Leak, Impacting 150,000 bpd

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Nigeria’s oil output has taken a significant hit following the shutdown of the Nembe Creek oil field due to a major oil leak.

The Nembe Creek oil field, responsible for producing approximately 150,000 barrels of crude oil per day (bpd), was forced to cease operations on June 17, 2024.

The leak occurred on the Nembe Creek Trunk Line (NCTL), a critical pipeline that transports oil from the Nembe Creek oil field to the Bonny Oil Export Terminal.

The operator of the pipeline, Aiteo Eastern Exploration and Production Company, confirmed the leak and the subsequent shutdown in a statement released yesterday.

Aiteo reported that the leak was discovered during routine operations in the Nembe area of Bayelsa State, located in Nigeria’s oil-rich Delta region.

This region is notorious for environmental degradation due to decades of oil spills, which have severely impacted local agriculture and fishing industries.

Following the discovery of the leak, Aiteo activated its Oil Spill and Emergency Response Team and shut down all production from Oil Mining Lease (OML) 29 as a precautionary measure to prevent further environmental damage.

“While we regret the production losses and the potential environmental impact, our current priority is to expedite an efficient spill management process in line with regulatory standards and collaborate with all stakeholders to restore production and mitigate associated risks,” said Victor Okronkwo, Managing Director of Aiteo Eastern E&P.

The exact cause of the leak remains unknown. Aiteo emphasized that the shutdown was a precautionary step to contain the spill and minimize environmental harm.

The company has notified its joint venture partners and relevant regulatory bodies, including the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) and the National Oil Spill Detection and Response Agency (NOSDRA), about the incident.

This development comes as a setback for Nigeria, which holds Africa’s largest natural gas reserves and is a major oil producer.

The country’s oil sector has faced numerous challenges, including aging infrastructure, theft, and environmental issues, which have hindered its ability to maximize production and exports.

The Nembe Creek shutdown also highlights ongoing concerns about the safety and reliability of Nigeria’s oil infrastructure. The NCTL has been a frequent target of oil theft and sabotage, exacerbating the challenges of maintaining a steady oil output.

Energy analysts believe that the latest incident could impact Nigeria’s ability to meet its export commitments and exacerbate the country’s economic challenges.

The Nigerian government, under President Bola Tinubu, has been making efforts to attract investment into the energy sector to boost production and address infrastructure deficits.

“The government will hope this offers confidence not only in the quality of the Nigerian resource base, but also in the government’s pledge to improve ease of doing business,” said Clementine Wallop, director of sub-Saharan Africa at political risk consultancy Horizon Engage.

As Nigeria works to address the immediate spill and restore production, the broader implications for the country’s oil sector and its environmental impact remain to be seen.

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Brent Crude Nears Seven-Week Highs as Market Eyes US Inventory Report

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Crude Oil - Investors King

Brent oil, the international benchmark for Nigerian crude oil, remained steady on Thursday, hovering just below seven-week highs as the escalating conflict in the Middle East raised concerns over potential supply disruptions.

At the same time, the market eagerly awaits U.S. inventory data for further indications of demand trends.

August Brent crude rose 28 cents, or 0.3%, to $85.35 a barrel while the U.S West Texas Intermediate (WTI) oil gained 13 cents, or 0.2%, to $81.70 a barrel.

“There was no WTI settlement on Wednesday due to a U.S. public holiday, which kept trading subdued,” noted Ricardo Evangelista, an analyst at ActivTrades.

“However, oil prices are likely to remain supported around current levels due to a growing geopolitical risk premium driven by conflict in the Middle East.”

Israeli forces have intensified their operations in the Gaza Strip, targeting areas in the central region overnight while tanks advanced into Rafah in the south.

The escalating violence has heightened fears of a broader conflict that could impact oil supplies from the region.

“Expectations of an inventory build appear to be overshadowing fears of escalating geopolitical stress for now,” said Priyanka Sachdeva, senior market analyst at Phillip Nova.

Investors are keenly awaiting the release of U.S. inventory data from the Energy Information Administration (EIA) later on Thursday, delayed by a day due to the Juneteenth holiday.

An industry report released on Tuesday by the American Petroleum Institute (API) indicated that U.S. crude stocks rose by 2.264 million barrels in the week ending June 14, while gasoline inventories fell, according to market sources.

The summer season typically sees an uptick in oil demand due to increased refinery runs and weather-related risks.

“Ongoing production cuts by the OPEC+ group, combined with seasonal demand, should tighten oil balances and lead to inventory draws during the summer months,” J.P. Morgan commodities analysts wrote.

Refining margins have also improved, with the ICE gasoil futures premium to Brent crude jumping to $20.63 a barrel on Wednesday, a two-month high.

“Firmer fuel refining margins provide a healthy dose of encouragement for those expecting improvements on the demand side,” commented Tamas Varga, an analyst at PVM.

In other economic news, the Bank of England’s decision to keep its main interest rate unchanged at a 16-year high of 5.25% ahead of the national election on July 4 has been noted by market observers.

Higher interest rates generally increase the cost of borrowing, which can slow economic activity and dampen oil demand.

As the market braces for the upcoming EIA inventory report, analysts and traders are closely watching for any signals that could influence oil prices in the near term.

The delicate balance between geopolitical tensions and supply-demand fundamentals continues to play a critical role in shaping the oil market landscape.

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