How Cashless Policy Will Prevent Nigerians From Evading Tax – Expert
As more money has been deposited into the vaults of the nation’s commercial banks by Nigerians in obedience to the directive of the Central Bank of Nigeria (CBN), an expert has said that it would be difficult for traders and business owners to escape paying their taxes.
The expert, who is the Head of Global Markets at Parthian Partners, Ronke Akinyemi said the naira redesign policy, has prompted a rise in digital banking, adding that it would promote tax inclusion and efficiency in the country.
Investors King had reported that the CBN in a view to mopping up larger Nigerian currency which is said to have been hoarded by some individuals and bringing same to the banks’ vaults, had brought up redesigning of the N1000, N500 and 200 denominations.
Accordingly, the apex bank announced that Nigerians should return the old notes so as to give way for the redesigned ones to be in circulation.
Though, CBN has miserly released the new notes, a situation that has subjected Nigeria to a cash crunch and caused citizens woes, the expert noted that the internally generated revenue base of the country would grow once the tax collection strategy is strengthened.
For Akinyemi, while speaking at the bi-monthly forum of the Finance Correspondents Association of Nigeria (FICAN) in Lagos, the paucity and control of naira in public would make more of the currency to be domiciled in banks’ vaults so as to the country to know how much each business owner has and thus determine the prompt payment of tax from affected individuals.
Aside from checkmating corruption and strengthening the economy, the expert said the naira redesign coupled with the cashless policy of the CBN is expected to see more naira move from private hands into the banking vaults ad thus promoting better monitoring from concerned authorities.
According to her, following the policy, it is expected that there will be increased remittances from government-owned enterprises.
She also noted that abundance of cash in banks would improve tax administration, adding that should the nation eventually transit to a full cashless economy, more money will be in the bank and that the banks would have an idea of who owns what and it will be easier for the tax collectors to go after those who have not been paying tax on who has been evading tax.
She said people have been evading tax because majority of their money has been in their hands but now that the better part of their money is in the bank, it would be easily for tax to be collected.
If tax is remitted as and when due, the expert noted that the nation’s economy would grow faster and that government would have more revenue for infrastructural development.
It could be recalled that the governor of the CBN, Mr. Godwin Emefiele had in a press conference in Lagos recently also alluded to the cashless policy enhancing tax collections and improving the nation’s revenue base.
Emefiele had noted that the short-term decline in cash holding and the increased formalization of business activities as the cashless policy forces more economic agents to open bank accounts, will also boost fiscal policy.
According to him, with more transactions going through e-channels and bank accounts, more agents come within view of the government’s tax net and that it would enlarge the base of taxable activities and increases the possibility of more tax receipts by various tiers of government.
Emefiele said the new policy would reduce tax evasion, saying that experiences from other jurisdictions have shown, effective currency redesign can support regulatory reform, increased legislative reach and coordinated fiscal and structural policies.
Osinbajo Lauds China on Loans Offered to Africans, Repayment System
Nigeria’s Vice President, Prof. Yemi Osinbajo has commended the Chinese government for the loans given to African countries and its repayment system.
According to Osinbajo, the Chinese loans have reduced the reliance of Africans on international financial institutions like the World Bank, and International Monetary Fund amongst others.
He stated these at King’s College, London on March 27, 2023 while delivering a public lecture on ‘China’s Investment in Africa, Investors King reports.
The Vice President lauded China for constantly meeting the needs of African countries which has reduced the burden on the western institutions.
He further mentioned that the loan servicing system was made easy to aid the African economies, especially during the Covid-19 Pandemic in 2020.
Through its Debt Service Suspension Initiative (DSSI), China offered 73 low income economies suspension of principal and interest payments.
“Chinese banks provided 63% of the total debt relief while being only owed 30% of the debt service payments due,” Osinbajo noted.
The VP pointed out that China is the largest provider of foreign direct investment which provides jobs for hundreds of thousands of Africans.
On Chinese investment in Africa, Osinbajo stated that $254 billion was disbursed in 2021 which was calculated as four times the volume of US-Africa trade.
“China remains by far the largest lender to African countries. Chinese companies have also taken the lead in exploiting minerals in Africa, many now in lithium mining in Mali, Ghana, Nigeria, DRC, Zimbabwe and Namibia. Most African countries are rightly unapologetic about their close ties with China. China shows up where and when the west will not or are reluctant.
“And many African countries are of the view that the ‘beware of the Chinese Trojan loans’ advice from the west is wise but probably self serving. Africa needs the loans and the infrastructure. And China offers them.”
“All of Chinese lending to Africa is only 5% of all outstanding public and publicly guaranteed debt in low and middle income countries, compared to 23% held by the World Bank and other multilaterals. Chinese lenders account for 12 per cent of Africa’s private and public external debt,” the vice president stated.
FirstBank Announces a Name Change of its Subsidiaries, Reiterates its Commitment to Boosting Cross-border Payments
First Bank of Nigeria Limited, Nigeria’s premier financial services institution, has announced a phased corporate name change of its subsidiaries in the United Kingdom and Sub-Saharan Africa.
FBNBank UK, FBNBank Sierra Leone, FBNBank Gambia and FBNBank DRC are the first set of subsidiaries effecting the name alignment. They are now known and addressed as FirstBank UK, FirstBank Sierra Leone, FirstBank Gambia and FirstBank DRC. The Ghana, Senegal and Guinea subsidiaries will be next in the phased name change implementation.
The name change is being implemented to align the subsidiaries with the parent brand and to enjoy the strong heritage and brand equity built by FirstBank Nigeria in its 129 years of banking leadership. This will further enhance the quality-of-service delivery resulting in better brand clarity, uniformity and consistency across all the markets where the Bank operates.
A leading financial inclusion services provider, FirstBank Group is committed to its nation-building goal. It has taken giant performance strides on its unique growth trajectory as it continues to build distinctive capabilities through partnerships and the constant drive to reinvent itself.
This performance is evidenced in the numerous awards and recognitions bestowed on the institution. These awards include Best Private Bank for Sustainable Investing in Africa 2023 by Global Finance Awards; Best Corporate Bank in Western Africa 2022 by Global Banking; Finance; Best CSR Bank Africa by International Business Magazine in 2022; and ranked as number one in Nigeria in terms of Overall Performance; Profitability; Efficiency and Return o Risk by the Top 100 African Bank Rankings 2022 released by The Banker Magazine from the stables of Financial Times.
In addition, in Euromoney Market Leaders, an independent global assessment of the leading financial service providers conducted by Euromoney Institutional Investor Plc., the Bank was crowned: Market Leader in Corporate and Social Responsibility (CSR); Market Leader in Environmental, Social and Governance (ESG); Highly Regarded in Corporate Banking and Digital Solutions and Notable: in SME Banking.
Speaking on the name change, Dr. Adesola Adeduntan, CEO of FirstBank Group, said ” the name change which coincides with FirstBank’s 129th founding anniversary (March 31 st , 2023) is indeed a milestone reflective of our resolve to continuously provide the gold standard of excellence and value as we put our customers First. The new identity of the subsidiaries contributes to an enhanced brand presence. It helps our customers and stakeholders better appreciate the value of the diversified products suites, competitive pricing and extensive business networks the FirstBank Group offers. These include our commitment to boosting cross-border businesses including trade and investment opportunities essential to enhancing trade relations amongst countries, thereby strengthening the economies of host communities and reducing poverty,” he concluded.
First Bank Denies Forgery Allegation in Face of Legal Battle with Loan Defaulter
First Bank of Nigeria Limited has issued a denial against the forgery allegation made by Francis Chukwumah Nwufor, the owner of Whiteplains British School.
In the lawsuit marked CR/266/2023, the federal ministry of justice had accused the bank of forging a “tripartite legal mortgage without the consent of Mr Francis Chukwumah Nwufor, with intent to commit fraud.”
In an official statement, First Bank described the accusation as a spurious allegation made by a delinquent debtor, which is aimed at tainting the bank’s loan recovery efforts and legal enforcement of its security collateral interest in line with the terms of the loan.
The bank emphasized that it operates by the highest standards of ethical conduct and will under no circumstances involve itself in any act of illegality. It further assured its numerous customers, stakeholders, and the general public that it remains focused on its mission of providing the best financial services.
The case has been adjourned until May 8th, as the prosecution lawyer stated that all the defendants had yet to be served with the charge.
It is common for loan defaulters to resort to legal battles with banks and this case is no different. However, it is important for both parties to ensure that the matter is handled in a transparent and legal manner.
First Bank’s denial of the allegation is a clear indication that it is standing firm against any attempt by recalcitrant debtors to fritter away depositors’ funds under its custody. The bank’s focus on its mission of providing the best financial services to its numerous customers is commendable and should be the guiding principle for all financial institutions.
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