Tunde Fowler: Tax and role of media

Tunde Fowler: Tax and role of media

Thursday, July 14, 2016 4:21 pm


Tunde Fowler

Tunde Fowler

By Tunde Fowler

I thank the organisers of this event for the privilege of speaking to a distinguished audience of journalists. Journalists seek the truth; they hold leaders accountable and together with scholar-activists and change agents, they point the course which societies should chart.

Investigative journalists belong to a special genre of the journalism profession. This is because they are believed to be more painstaking, rigorous, patriotic and far-sighted. Many perceive investigative journalists as systematic and in-depth practitioners. Their works, many hold, consist of original research and reporting, often involving the unearthing of secrets and hidden facts with social justice, accountability and Common Good as the goals of the work that they do.

I thank the founders of the Wole Soyinka Centre for Investigative Journalism for their celebration of our own and only Kongi, the erudite Professor Wole Soyinka, who has remained the conscience of the nation, many times at personal risks, for decades. He hoists the Nigerian and African flag on the global stage. I feel honoured to speak at this distinguished centre.

Investigative journalists in Nigeria have a rich past as their works have achieved the following among others:

· exposure of the Koko Nuclear Toxic wastes, which compelled Italy to evacuate her cargoes of death from Nigeria;

· resignation of a former Speaker elect, Salisu Buhari, following the famous ‘Toronto University’ certificate scandal saga;

· the exposure of the dehumanizing work conditions in a Chinese factory in Lagos.

In the United States of America, we are all familiar with the Watergate Scandal, which culminated in the resignation of Richard Nixon and the New York Times expose on the Anthrax scare, which the paper claimed, came from mails that originated inside and not outside the US.

Two months ago, an in-depth investigative work by the International Consortium of Investigative Journalists’—a global network of more than 190 investigative journalists in more than 65 countries- exposed financial details of tax evasion by offshore firms with a Panama based law firm; Monssack Fonsecca, as the linch pin for the fraud.

This expose is of significant importance to Revenue Authorities all over the world, several of which are already putting machinery in place to take advantage of the revelation.

FIRS’ EXPERIENCE
The FIRS is an agency of the Federal Government saddled with the responsibility to: assess, collect, enforce and account for taxes collected. We do not expend the revenue we collect.

The First Schedule of the FIRS Establishment Act (FIRSEA) 2007, empowers the FIRS to collect the following taxes:

· Companies Income Tax,
· Petroleum Profits Tax,
· Personal Income Tax,
· Capital Gains Tax,
· Value Added Tax,
· Stamp Duties,
· National Technology Development Levy,

In taxation—about which the distinguished former President of the Chartered Institute of Taxation of Nigeria (CITN) Mrs. Adebimpe Balogun, will speak, the end of a tax authority’s efforts are best rendered in figures (collections).

That is, how much a tax authority brings into the public till to fund a state or a nation and at a reasonable cost of collection-what accountants call the bottom line. FIRS has not done badly in providing revenue for national development as the table below shows:

FIRS Collection 2011-2015 (Trillion)
Year OIL REVENUE NON-OIL REVENUE TOTAL
2011 3.071 1.558 4.628
2012 3.201 1.801 5.003
2013 2.667 2.139 4.806
2014 2.454 2.261 4.715
2015 1.290 2.452 3.742

FIRS collection figures from 2011-2015 Source: Revenue Accounting Department, FIRS

SOME MILESTONES IN FIRS
· In 1943 the Nigerian Inland Revenue Department, was carved out of the Inland Revenue Department of British West Africa and renamed the Federal Board of Inland Revenue under the Income Tax Ordinance No. 39 of 1958.

· In 1961 the Companies and Income Tax Act No. 22 of 1961 established the Federal Board of Inland Revenue, FBIR. CITA 1961 and the Body of Appeal Commissioners to resolve disputes between taxpayers and the Board.

· The Income Tax Management Act 1961 created the Joint Tax Board (JTB), to ensure uniformity of standards and application of Personal Income Tax in Nigeria.

· In 1978, part of the recommendations of the Study Group led by Shehu Musa led to the introduction of the Witholding Tax.

· In 1993 the passage of the Finance (Miscellaneous Taxation Provisions) Act No 3 of 1993, Decree 104 of 1993 reviewed the composition of the FBIR and also established the Federal Inland Revenue Service (FIRS) as the operational arm of the FBIR.

· In 1993, the Value Added Tax, VAT was introduced.

· In 2006, the Bank Collection Agreement and the introduction of Collecting Banks began to stem cash and cheque-based leakages in the FIRS collection process. Collection of cash and cheques in tax offices ceased. Taxpayers started paying into Federation Account through commercial banks, from where it is swept, daily, into the Central Bank of Nigeria, CBN.

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