In line with the dwindling economic fortunes the nation currently grapples with, a unanimous opinion is that government across levels must boost Internally Generated Revenue, strengthen tax collection, and purge the system of loopholes.
To make the current economic situation direr, the number of employment opportunities for the unemployed continues to drop, Naira continues to weaken daily to the Dollar. Sadly, a number that continues to rise is the number of monies lost to illicit financial flow yearly by government Ministries, Departments, and Agencies.
The monstrous number of illicit financial flow has gotten the attention of the Federal House of Representatives with a resolve to summon heads of Federal Inland Revenue Service, Central Bank of Nigeria, Nigeria National Petroleum Corporation among various other MDAs under the behest of the Federal Government.
In a shocking revelation, it was discussed by members of the hallowed chambers that statistics show that the number of revenues lost annually to illicit financial flow is more than the sums provided as Development Aid. This is irrespective of the fact that the Nation has at least 12 institutions and agencies responsible for tackling IFF and related crimes.
The summon is aimed at reviewing current laws and policies to stemming the tides of this illegal financial flow that continues to deny the government an appreciable amount of revenue to fund its budget.
Taxmobile.Online gathered that the plenary held a few hours ago, today Thursday 6th of May 2021 saw to House of Representatives mandating committees that has oversight over these MDAs to forthwith, commence an in-depth investigation into this phenomenon of illicit financial flow.
The committees that were identified to carry out this task include Finance; Anti-Corruption; Financial Crimes; Banking and Currency; and Insurance and Actuarial Matters. A key illicit financial flow identified is cross-border tax evasion.
Consequently in addition to the MDAs highlighted earlier in this article, the Minister of Finance, Budget and National Planning, Zainab Ahmed, Economic, and Financial Crimes Commission, Independent Corrupt Practices and Other Related Offences Commission, Nigerian Financial Intelligence Unit, and Nigerian Export-Import Bank are all slated to appear before the committee.
The resolve of the house to take this investigative action was led in a motion by Chairman of the House Committee on Local Content, Ochiglegor Idagbo who summarized that Nigeria needs to strengthen regulatory structures and eradicate complicity of other financial secrecy among others.
In his words
“The House is disturbed that the Report of the Global Financial Integrity, 2014, showed that Nigeria lost a minimum of $140bn to illicit financial flows between 2000 and 2014, mainly to crude oil and commercial activities mispricing, thus Nigeria was ranked among the global top 30 countries having Illicit Financial Outflows by dollar value and in 2015, a total of $8.3bn has involved in the illicit financial outflows.
“The House is also disturbed that the Tax Justice Network and the International Monetary Fund estimated that developing countries, including Nigeria, lose over $200bn per year to illicit financial flows as multinational corporations neglect, fail, and/or refuse to pay taxes, despite generating substantial profits.
“The House is concerned that the incessant financial drain on the country’s economy by the Illicit financial outflow continues to have negative implications for domestic resource, mobilization, and long-term economic growth and development, as approximately 5 percent of the IFF from Africa can be attributed to corruption, while the remaining 95 percent comes from commercial and criminal activities.”
“The net official Development Aid received by Nigeria in 2017 was $3,358,790,000, and the United States Agency for International Development has donated over $526.7m in humanitarian assistance to Nigeria and the Lake Chad Basin since 2017. Yet, none of the aforementioned figures matches the estimated $15 and $18bn Nigeria loses to IFFs annually, hence Nigeria continues to struggle with growing inequality, poor infrastructure and lacking service delivery,” he said.
“The House is worried that an estimated 60 percent of IFF from Nigeria is predominantly committed by multinational corporations, which continue to drive the cross-border siphoning of the country’s revenues to the direct and/or indirect benefit of foreign economies;
“The House is also worried that international information sharing and domestication of relevant policies have become a global priority to ensure cross-border cooperation to tackle this global threat to national revenue generation and its negative economic and developmental impacts.”