The monstrous numbers as monies lost from tax evasion, willful negligence, and other illicit financial flow are in no small way getting the attention of the central government as the Federal Inland Revenue Service, FIRS has decided to talk tough on tax defaulters especially in the categories of Ministries, Departments, and Agencies.
With a statement recently released by the FIRS, one can conclude that no stone will be left unturned in the quest for more Internally Generated Revenue. In the statement, the FIRS will now clamp down on tax defaulters by deducting directly from their bank accounts or statutory allocations or have their other assets seized by the FIRS and turned over to the Government of the Federation following the withheld taxes.
In a bid not to take further chances and leave room for loopholes, the FIRS also plans to recover taxes due from the defaulters’ via its asset in the custody of any person, including but not limited to sums standing to its credit with a financial institution in Nigeria.
The FIRS before arriving at this stringent measure had earlier opened up a 60-day window for erring parties to pay all outstanding tax liabilities. With the new directive, tax defaulters now have 30-days to pay up counting from Wednesday 5th March 2021.
The rationale behind the decision
If the statement by the agency is anything to go by as duly signed by its Director of Communication and Liason Department, Abdullahi Ismaila Ahmad, the decision came on the heels of an increase in the rate of illegal withholding of taxes from public and private entities.
What you should know
The FIRS’s step aimed at increasing compliance through deduction from a bank account or seizure of assets is in line with Section 31 of the FIRS Establishment Act of 2007 as amended.