Senate summons Zainab Ahmed, Emefiele, others over cross-border tax evasion
Also summoned are
heads of the Federal Inland Revenue Service (FIRS); Economic and Financial
Crimes Commission (EFCC); Central Bank of Nigeria (CBN); and Independent
Corrupt Practices Commission (ICPC).
The heads of the
Nigerian Financial Intelligence Unit (NFIU); the Nigerian Export-Import Bank
(NEXIM); Nigerian National Petroleum Corporation (NNPC) among other relevant
institutions were also invited.
The decision was
sequel to a motion sponsored by Gershom Bassey on “the need to review the
domestic legal framework against illicit Financial Flows and to consider the
creation of a Tax Amnesty for the voluntary repatriation of funds to Nigeria.”
In his presentation,
Mr Bassey noted that Nigeria lost a minimum of $140 billion to illicit
financial flows between 2000 and 2014, mainly to crude oil and commercial
activities mis-pricing.
This economic loss,
he said, was not abated, as Nigeria was ranked among the global top 30
countries of illicit financial outflows by dollar value, with $8.3 billion in
illicit outflow from Nigeria in 2015.
Findings by the Tax
Justice Network and International Monetary Fund reveals that developing
countries, including Nigeria, have lost over $200 billion per year to illicit
financial flows as multinational corporations neglect and refuse to pay taxes
in these countries where they generate substantial amounts of profit, he
explained.
“Nigeria loses
approximately $15 billion annually to offshore tax evasion. This has resulted
in a consistently low tax revenue as a percentage of Gross Domestic Product
(GDP), as low as 5.7 percent in 2017. Such statistics are alarming, especially
when compared to the 17.2 percent average of 26 African countries in the same
year.
“This incessant
financial drain on the Nigerian economy continues to have negative implications
for domestic resource mobilization and long-term economic growth and
development,” Mr Bassey said.
The lawmaker
lamented that though Nigeria has at least 12 institutions and agencies
responsible for tackling illicit financial flows (IFFs), the country “continues
to be menaced by weak regulatory structures and the complicity of other
financial secrecy jurisdictions, among others.”
While mandating the
relevant committees to investigate illicit financial flows, the Senate called
for an appraisal of the Federal Inland Revenue Service’s current framework for
tracing, identifying, preventing and sanctioning cross-border tax evasion and
other illicit financial outflows.
The Senate also
mandated the committee to come up with a holistic legislative framework on how
to repatriate lost revenue due to illicit financial flows, mitigate such future
unabated flows and provide an efficient strategy for the reinvestment of
repatriated resources into the Nigerian economy.
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