Group demands information on tax waivers, grants to tobacco companies

Group demands information on tax waivers, grants to tobacco companies

Tuesday, December 13, 2016 2:29 pm

British America Tobacco

British America Tobacco

The Environmental Rights Action/Friends of the Earth Nigeria (ERA/FoEN) has requested that the Nigeria Customs Service (NCS) release detailed information on tax waivers, grants and other benefits that British America Tobacco Nigeria (BATN) and other tobacco companies benefited under the now-rested Export Expansion Grant (EEG) Scheme introduced by the Chief Olusegun Obasanjo administration in 2002.

The EEG schemeis an export incentive designed to assist indigenous exporters to expand the volume and value of their exports, diversify export markets and become more competitive in the international market.

Exporters get cash grants for exporting semi-manufactured or manufactured products with the incentive element in the graduation of the grant according to volume of export sales.
Under the scheme, which was adjusted in 2003, the federal government gave up to 40 percent to any industry that exported and repatriated money on intermediate and finished products.

ERA/FoEN believes that BATN which had over the years claimed it was paying billions of naira in taxes did not actually qualify to benefit from the scheme and merely hid under the platform of manufacturer to leach on Nigeria.

In a letter addressed to the Comptroller-General of NCS on 28 November 2016 and copied to the Minister of Finance, titled Request for information under the freedom of information Act with specific reference to the tax benefit (s) in the tobacco industry, ERA/FoEN made 11 specific requests.

In the letter by ERA/FoEN solicitors – A. M. Kotoye, FCTI – the group is requesting the volume and brand names of cigarettes exported from Nigeria from 2002 till present, by which company and to which country, and volume and brand names of cigarettes imported into the countrywithin the same time frame.

ERA/FoEN is demandingthe release of information on how much BATN benefited from the EEG from 2004 to 2014, tax waivers or tax exemptions the company benefitted from the Nigerian government from 2004 till date, and how much tax waiver, or grants benefited by any other tobacco company operating in Nigeria within the same time frame.

It is also asking for information on the volume of raw tobacco leaf BATN imported into Nigeria and from which country, volume of shredded tobacco imported into Nigeria by BATN and from which country as well as volume of raw tobacco leaf imported into Nigeria by any other tobacco Company, into Nigeria and from which country.

The group also wants to know the volume of shredded tobacco by any other tobacco company, into Nigeria and from which country, location of Cigarette factories in Nigeria as well as volume and brands produced from each factory.

The text of the letter also detailed that if the NCS believes that another agency, ministry or department of the government has greater interest in the information requested for, it is obliged under Section 5 of the FOI Actto transfer the request to that agency, ministry or department within three days but not later than seven days of receiving the request.

On why the FOIA request, ERA/FoEN Deputy Executive Director, Akinbode Oluwafemi said “ We as an organization decided to align with the Federal Government in tracking and tracing every revenue that was illegally diverted into private hands or undue grants that was used to bleed our economy. It is also to lay bare how much the tobacco companies have deceived the Nigerian government and the Nigerian people about the economy of tobacco business in Nigeria.”

He added that if the agency fails to respond to the request at the stipulated time the organization will not hesitate to file appropriate legal action in the court as provided for by the law.

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