Economic Council Endorses Scheme To Address High Rate Of Tax Evasion

Economic Council Endorses Scheme To Address High Rate Of Tax Evasion

The National Economic Council has approved the implementation of the Voluntary Asset and Income Declaration Scheme aimed at addressing high rate of tax evasion by Nigerians.

The Chairman, Federal Inland Revenue Services, Babatunde Fowler, made this known on Thursday in Abuja while briefing the State House Correspondents on the outcome of the National Economic Council Meeting.

Fowler briefed the correspondents alongside Governor Okezie Ikpeazu of Abia State and Kaduna State Deputy Governor, Bala Bantex.

He said the council’s approval of the scheme followed a presentation by the Minister of Finance, Kemi Adeosun.

Fowler said that in the presentation, the minister also alerted the state governors on the high rate of tax evasion in the country.

According to him, the minister also spoke about the low number tax payers within Nigeria, currently at 14 million out of a minimum of 40 million.

Fowler said: “We expect all hands to be on deck to help us improve our country.
“So basically, she was asking for the support of the governors.”

He said that the VAIDS, which might become operational in May, would boost the revenue portfolios of the Federal and State Governments.

He said that FIRS was targeting an increase in tax contribution to the Gross Domestic Products to 18 per cent by 2020.
Fowler said: “The scheme which is expected to run from May 1, 2017 for up to six months will have incentives in place to encourage early participation.

“Under the scheme, tax payers will be allowed up to three years to settle their liabilities.

“The scheme is also expected to capitalise on the current global movement against tax evasion and illicit financial flows.
“It will offer a window for those who have not complied with the extant tax regulations to remedy their positions by the provision of limited amnesty to enable voluntary declaration and payment of liabilities.

“It is anticipated that at least 50 per cent of the funds recovered will belong to states which are the ultimate collectors of personal income taxes.”

According to Fowler, MoU will be gazetted and signed with each state government for the successful implementation of the scheme.

He stressed the need for collaboration between the Federal and State Governments to widen the tax net.

In his remarks, Governor Ikpeazu revealed that the council also deliberated on the need to accelerate and review the extant National Forest Policy as well as ensuring its backing through the enactment of relevant Forest Laws.

He said that council recommended massive afforestation/reforestation of degraded forests and landscape outside forests.
According to him, it also recommended the take-off of the National Forestry Trust Fund through contributions by Wood Products Exporters in line with products classification (tally processed, semi-processed, and charcoal).

Ikpeazu said: “It recommended the establishment of the National Forest Model Estate in all the states and FCT, improvement in forest governance and establishment of National Task Force.

“This is to effectively protect the Forest Estate/Reserve as well as effective monitoring, evaluation, documentation of trade in wood and wood product.”