Adeosun: Executive Order on Asset Declaration, Sign of Govt’s Seriousness on Tax Compliance

minister-of-finance-kemi-adeosunMinister for Finance, Kemi Adeosun
  • Executive Order on Asset Declaration, Sign of Govt’s Seriousness on Tax Compliance

The signing of an Executive Order on Assets and Tax Declaration by the Acting President, Prof. Yemi Osinbajo, underlines the seriousness attached to the Voluntary Asset and Income Declaration Scheme (VAIDS), the Minister of Finance, Mrs. Kemi Adeosun, has said.

Adeosun said the scheme, which was launched in Abuja last week, would be vigorously implemented, adding that the federal government would deploy and heavily rely on technology to increase tax compliance
In an interview on Channels Television, the minister stated that at six per cent tax-to-GDP ratio, Nigeria’s tax compliance rate was low while most nations are at between 30 and 32 per cent.

“Prosperous nations have high levels of tax compliance while poor nations have low rates. Nigeria aspires to be a prosperous nation, so this problem must be solved,” Adeosun said.

She revealed that the government had deployed data mining to compile data on thousands of tax payers, which showed the level of non-compliance and tax evasion. Citing the Bank Verification Number (BVN), land registry and other sources within Nigeria as well as data from foreign governments, she also detailed the work of an international asset tracing firm as a source of overseas data.

“Technology has been key in enabling us to build an accurate financial profile for Nigerians and based on the information we gathered, we saw that the level of non-compliance was very high and we knew we had to do something about it.

“In the past, tracking true income and assets would have been difficult but now, it is at the touch of a button,” she said.

The minister revealed that further information would automatically become available in 2018 under the Automatic Exchange of Information, to which Nigeria is a party, stressing that Nigeria will automatically get information through tax authorities of various countries.

“What VAIDS is doing is giving tax payers, both companies and individuals, a window of opportunity to regularise, to come clean so to speak, to declare fully, to declare honestly.

“In exchange for full and honest declaration, what we are assuring is that we will waive penalties that should have been levied, waive the interest that should have been paid on overdue tax which is quite considerable, those who declare honestly will not be subject to any investigation or tax audit,” she explained.

VAIDS, she added, is also to help increase tax awareness and education.
“The Community Tax Liaison Officers (CTLO), who are graduates recruited through the N-Power programme, would go into their communities, schools and other public places to raise awareness and help increase tax enrollment. We are recruiting a total of 7,500 CTLOs through this scheme,” Adeosun stated.

The minister gave details of the ‘Tax Thursdays’ programme which will operate for the next one year, as announced by the Osinbajo and would see tax awareness activities at state and federal government level to improve tax education and increase the number of tax payers from the current 14 million out of 69.9 million who are economically active.

The minister gave assurances of the judicious use of funds, saying that “tax payment is part of the civic partnership between people and government which would enhance participation and accountability.”

On the confidentiality of information generated on individuals, she assured that “all information collected would be treated as strictly confidential and our doors are open. We understand that some people have significant declarations and people can walk in to speak with me. We have already started receiving inquiries.”

About the Author

Samed Olukoya
CEO/Founder Investors King Ltd, a foreign exchange research analyst, contributing author on New York-based Talk Markets and Investing.com, with over a decade long experience in the global financial market. Contact Samed on Twitter: @sameolukoya; Email: [email protected]

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