- Fowler to Expose Tax Evaders, Urges IoD Members to Embrace VAIDS
The Chairman of the Federal Inland Revenue Service (FIRS), Mr. Tunde Fowler, has warned that tax evaders risk being exposed if they fail to pay up and urged members of the Institute of Directors (IoD) to take advantage of the Voluntary Assets and Income Declaration Scheme (VAIDS).
Fowler gave the advice in Lagos during the week while making a presentation on the tax amnesty scheme to IoD members.
During the presentation titled: ‘Achieving Voluntary Tax Compliance: The VAIDS Option’, the FIRS chairman explained that the key motivation for introducing the scheme is that the country’s tax remittance rate remains low despite having some of Africa’s most profitable and well capitalised companies.
“Nigeria’s low tax revenues are inconsistent with the lifestyles and spending habits of a large number of citizens. Many are engaged in transfer of assets overseas, use of offshore companies in tax havens and registration of assets in nominee names,” said Fowler.
He noted that tax evasion constitutes a significant challenge to the government and listed a number of ways through which taxes are evaded. Among these, he said, are manipulation of accounting records, use of complex structures for transanctions, non-registration for Value Added Tax (VAT), non-payment of Capital Gains Tax ( CGT) on asset disposal and escaping detection of income due to lack of machinery for tracing such.
The FIRS boss, however, warned that under VAIDS, tax evaders will not escape. He explained that the Federal Ministry of Finance, in collaboration with relevant tax authorities, is building a revenue assurance platform through extensive gathering of data from sources that include Bank Verification Number (BVN), Nigerian Financial Intelligence Unit (NFIU), Corporate Affairs Commission (CAC), land allocation and land ownership records, foreign exchange allocation returns and bureaux de change records. Others are Central Securities Clearing System (CSCS), information from foreign governments as well as whistleblower tips and leaks.
The FIRS Chairman instantiated information from foreign governments with the recently passed Unexplained Wealth Order in the UK, Wikileaks, Panama Papers and Automatic Exchange of Information (AEoI), to which Nigeria is signatory.
He stated that IoD members have, as obligations, leading the charge for truthful and voluntary declaration of all income by corporate bodies, voluntary tax compliance as individuals and corporate bodies, being tax ambassadors by raising tax awareness among peers and being exemplary citizens in words and deeds. VAIDS offers tax defaulters a window to declare their indebtedness and escape tax interests and penalties as well as prosecution. The scheme closes on 31 March.
Gold Gained Ahead of Joe Biden Inauguration 2021
Gold price rose from one and a half month low on Tuesday ahead of President-elect Joe Biden’s inauguration on Wednesday.
The precious metal, largely regarded as a haven asset by investors, edged up by 0.2 percent to $1,844.52 per ounce on Tuesday, up from $1,802.61 on Monday.
He said, “The key factor appears to be the (U.S.) currency.”
As expected, a change in administration comes with the change in economic policies, especially taking into consideration the peculiarities of the present situation. In fact, even though Biden, Janet Yellen and the rest of the new cabinet are expected to go all out on additional stimulus with the support of Democrats controlled Houses, economic uncertainties with rising COVID-19 cases and slow vaccine distribution remained a huge concern.
Also, the effectiveness of the vaccines can not be ascertained until wider rollout.
Still, which policy would be halted or sustained by the incoming administration remained a concern that has forced many investors to once again flee other assets for Gold ahead of tomorrow’s inauguration.
Crude Oil Holds Steady Above $55 Per Barrel on Tuesday
Brent Crude oil, against which Nigerian crude oil is priced, rose from $54.46 per barrel on Monday to $55.27 per barrel as of 9:03 am Nigerian time on Tuesday.
Last week, Brent crude oil rose to 11 months high of $57.38 per barrel before pulling back on rising COVID-19 cases and lockdowns in key global economies like the United Kingdom, Euro-Area, China, etc.
While OPEC has left 2021 oil demand unchanged and President-elect Joe Biden has announced a $1.9 trillion stimulus package, experts are saying the rising number of new cases of COVID-19 amid poor vaccine distribution could drag on growth and demand for oil in 2021.
On Friday, Dan Yergin, vice-chairman at IHS Markit, said in addition to the stimulus package “There are two other things that are going with it … one is of course, vaccinations — in the sense that eventually this crisis is going to end, and maybe by the spring, lockdowns will be over.”
“The other thing is what Saudi Arabia did. This is the third time Saudi Arabia has made a sudden change in policy in less than a year, and this one was to announce (the) 1 million barrel a day cut — partly because they are worried about the impact of the surge in virus that’s occurring,” he said.
Also, the stimulus being injected into the United States economy could spur huge Shale production and disrupt OPEC and allies’ efforts at balancing the global oil market in 2021.
Crude Oil Pulled Back Despite Joe Biden Stimulus
Crude oil pulled back on Friday despite the $1.9 trillion stimulus package announced by U.S President-elect, Joe Biden.
Brent crude oil, against which Nigeria’s oil is priced, pulled back from $57.38 per barrel on Wednesday to $55.52 per barrel on Friday in spite of the huge stimulus package announced on Thursday.
On Thursday, OPEC, in its latest outlook for the year, said uncertainties remain high in 2021 with the number of COVID-19 new cases on the rise.
OPEC said, “Uncertainties remain high going forward with the main downside risks being issues related to COVID-19 containment measures and the impact of the pandemic on consumer behavior.”
“These will also include how many countries are adapting lockdown measures, and for how long. At the same time, quicker vaccination plans and a recovery in consumer confidence provide some upside optimism.”
Governments across Europe have announced tighter and longer coronavirus lockdowns, with vaccinations not expected to have a significant impact for the next few months.
“The complex remains in pause mode, a development that should not be surprising given the magnitude of the oil price gains that have been developing for some 2-1/2 months,” Jim Ritterbusch, president of Ritterbusch and Associates, said.
Still, OPEC left its crude oil projections unchanged for the year. The oil cartel expected global oil demand to increase by 5.9 million barrels per day year on year to an average of 95.9 million per day in 2020.
But also OPEC expects a recent rally and stimulus to boost U.S. Shale crude oil production in the year, a projection Investors King experts expect to hurt OPEC strategy in 2021.
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