Tobi Aminu

FIRS Unions restate dedication to N8.8t target

The two labour unions at the Federal Inland Revenue Service have reassured Nigerians, the Federal Government and FIRS management that they will ensure that the N8.8 trillion revenue target for 2019 is realised. Comrade Okere Samson, Chairman, FIRS chapter of the Association of Senior Civil Servants of Nigeria, and Comrade Idris Hassan of the Nigerian Civil Service Union, (FIRS chapter), gave the assurance during the week after their meetings with FIRS Chairman, Tunde Fowler. According to public notices circulated by the unions to FIRS staff, the FIRS Chairman has raised the level of staff welfare and unfolded a slew of pro-staff decisions that will enable staff to realise their individual and organisational goals. Fowler jerked up subsistence allowance from 20 per cent to 30 per cent (it was 10 per cent before the Chairman’s appointment in 2015), pegged payment of Key Performance Indicators at 70 per cent instead of 80 per cent for non-oil tax receipts, directed expedited payment of first 28 Days Movement Allowances to staff on transfer, approved meal, children education and maintenance grants – once staff meet target and attain some consensus on the vacancies for 2018 and 2019 promotion exercises. Apart from increase of subsistence allowance, staff have also been paid wardrobe allowances, while quarterly bonus on met or exceeded target in revenue collection, 13th month salary and payment of equity contribution to benefiting staff of the FIRS Mass Housing Scheme have also been approved. An amount has been provided in the 2019 budget for to this effect. In the two documents circulated to all staff, titled: “Update on Staff Matters, signed by Comrade Samson, and another co- signed by Comrades Hassan and Jimoh Idowu, the two unions rededicated their commitment and that of their members to the realisation of the N8.8 trillion target of the Service. The documents detailed staff welfare issues discussed at a meeting between the two unions and FIRS Management held on June 6 and another on June 10, 2019 as well as resolutions reached. Comrade Hassan said: “This is to inform FIRS Staff that following continuous engagement between Nigeria Civil Service Union, (NCSU) and Management of the FIRS, Management has been able to address most of the issues raised like increment of subsistence allowance to 30%, reduction of KPI (Key Performance Indicators) benchmark from 80% to 70% of non-oil, and payment of terminal benefits to staff among others.” In another document titled: “Matters Arising from the NCSU Meeting with Management,” Comrade Hassan said: “Based on the above, the Union hereby implores all staff to be of good behaviour, remain dedicated and hardworking in order to achieve the set revenue target for the Service. We, the Executive of NCSU assure our members and entire staff of the Service of our support and also continue to engage Management for better welfare and reward hard work. We equally assure Management of our continuous support as partners in progress towards the actualisation of the goals and objectives of the Service.” The Chairman of ASCSN counselled the staff to work harder towards ensuring that the Service realises its 2019 revenue target, while the union keeps engaging the Management to always appreciate and reward staff for hard work. On proposed staff grants such as meal subsidies, children’s education and furniture maintenance grants, Samson said that the FIRS Chairman has directed the Director Human Capital to implement the payment of the grants once the FIRS attains 70 per cent of its non-oil revenue target after the third quarter of the year. All outstanding severance benefits to retired staff have been approved for payment to staff that exited the Service since November 2018, while the FIRS Chairman directed that more working tools such as printers, laptops and furniture be provided by Directors in charge of Facility and Efficiency to ensure timely distribution of such tools to field offices. On the 2018 and 2019 promotion exercise, Fowler, stated Samson, directed the association to meet with the Director, Human Capital Management Department for a review of the promotion vacancies and revert to the Management for approval. Specifically on those who passed but were not accommodated on account of vacancies, the NCSU Chairman, Comrade Idris Hassan, said: “Chairman (Fowler) directed the Union to liaise with the Director Human Capital and Director, Legal to work out  modality  on how to resolve the issues within the ambit and provisions of the laws and the HRPP, (Human Resources Policies and Processes).” Fowler assured staff that all outstanding severance benefits to retired staff have been approved for payment to staff that exited the Service since November 2018.   Source: Punch

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N29.2m VAT penalty: Tribunal fixes judgement for June 19

The Tax Appeal Tribunal sitting in Abuja on Wednesday fixed June 19, to deliver judgment in an appeal of N29. 2 million remittance on Value Added Tax (VAT) filed by Infinity Trust Mortgage Bank. The bank is challenging the Federal Inland Revenue Service (FIRS) for imposing the amount. The tribunal headed by Alice Iriogbe fixed the date after parties in the suit adopted their final written addresses. The appellant is seeking the order of the tribunal for the annulment of the FIRS’s assessment or demand notice dated May 17 and July 6, served on it with penalty at 10 per cent and interest at 15 per cent. Responding, FIRS stated that the letter of reviewed and audited accounts were valid and issued in accordance with the relevant provisions of the law. FIRS sought the tribunal to declare that the VAT demand served on the Bank was valid and made in accordance with the law. The respondent further sought for a declaration that the VAT transaction by the appellant outside the main objectives of its business, is liable to VAT. FIRS further sought for an order compelling the appellant to pay to the respondent the sum of N29. 2 million being its VAT liability for the period of 2015 to 2016 as contained in the demand letter. At the resumed sitting , Mr Olumide Olujimi, counsel for the appellant in adopting his address, urged the tribunal to uphold the appeal and the reliefs sought. Mr Thiwhi Dauda, counsel for FIRS also urged the tribunal to discountenance the appeal and order the appellant to pay.   Source: Punch

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CITN renews vision statement to widen horizon

To widen its corporate horizon, the Chartered Institute of Taxation of Nigeria (CITN), has renewed its vision and mission statement, with the hope to pursue the actualisation of both with more vigour. The body added that it is also planning to be a leading Institute in training world-class tax professionals. It explained that the planned tax academy would be developed to project the fundamental driving force of its vision, while it will engage all stakeholders with an inclusive mind-set and strengthening other capacity building programmes. New CITN President, Dame Gladys Simplice, said this in her address during her investiture as the 14th president of the Institute over the weekend. She said the tax academy will be repositioned in terms of capacity for a technically-driven alternative route to membership through intensive training for revenue services staff. To admit lawyers into the Institute, she said they will go through extended period for pre-induction training to close the knowledge gap in their accounting and taxation. On the international scene, Simplice, who is also the President of the West Africa Union of Tax Institutes (WAUTI), said the Institute will continue to push for inclusiveness and full membership of member states to broaden their horizon and development with the needed expertise in the sub-region. The special guest of honour, Executive Chairman, Federal Inland Revenue Service (FIRS), Babatunde Fowler, said globally, the issue of taxation is already on the front burner where the profession is seen to be of importance than before. While promising his support for the president, Fowler said Nigeria has attained the position where taxation can be recognised as a choice of destination. Lagos State Governor, Babatunde Sanwo-Olu, represented by the Permanent Secretary, Ministry of Finance, Mrs Balogun, while congratulating Simplice, urged Lagosians to pay their taxes regularly for more infrastructural development in the state. Sanwo-Olu also promised to partner with the institute for development of the state.   Source: Guardian

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State gaming regulators kick against VAT, explain operations

State gaming regulators have called for a better understanding of their operations, unity of processes and licensing, especially from the lens of the National Lottery Regulatory Commission (NLRC).Under the aegis of Association of State Gaming Regulators in Nigeria (ASGRN), the body also kicked against plans by the Federal Inland Revenue Service (FIRS) to introduce Value Added Tax (VAT) on gaming in Nigeria. ASGRN added that implementing VAT in gaming could have a devastating effect on the economy.The body, which is however, silent about the “devastating effect”, noted that the constant impasse of the NLRC on their operations needed to be curbed. The body, which rose from a recent meeting, which comprised representatives from states currently regulating all-gaming activities, condemned the lingering issues of rights to regulate   the industry between states and the Federal Government’s agency and others. Jointly speaking after the meeting, the chairman of Enugu State Gaming/Lotto Commission, Harrison Ogara, and the Head, Pools and Betting Division of the Ogun State Internal Revenue Service (OGIRS), Felix Fagbohun, flayed the activities of the officials of NLRC, who they said were going from state to state to shut down gaming operators legally licensed by the State Government. ASGRN explained that it was illegal for a national agency, in the mold of NLRC to claim rights to regulate gaming activities clearly under the residual list in the Constitution of the Federal Republic of Nigeria (as amended) adding that such activities are tantamount to eroding the very essence of true federalism. Explaining further, Fagbohun enunciated that while some of its members have regulated the industry under gaming laws promulgated as far back as 1981 and 1991, the NLRC only came into existence in 2005”. Fagbohun stressed that ASGRN is operating from the constitutional realm adding that “for NLRC to assume the roles it is playing now, the Commission must first seek for an amendment of the Constitution of the Federal Republic of Nigeria, because as it is today, gaming regulatory power lies in the states.” While recounting some of their latest issues with NLRC, Ogara said: “When we noticed the obvious infraction on the provisions of our statute, the states were taken aback and surprised by this act, since the NLRC itself had reached out to the states to explore a joint approach to regulations, a development that was warmly embraced and supported by a few states. However, following concerted efforts of some of the states a lot of progress had been made, until this unfortunate act by the NLRC.” Ogara emphasised   that   the   authors of   the   Constitution   gave   the regulatory role to states because of the peculiar nature of the industry, states and their religious inclinations. “Nigeria is a Federation where the three tiers of government are expected to act independently together. We are also aware that there are cases in Supreme Court seeking for clarification over who has rights to regulate gaming.” While justifying the right of the state to regulate gaming, the body pointed to the recent Bauchi State Government’s ban on all gaming activities in the State citing several reasons. “This singular realisation that gaming/gambling is prohibited by some religions and other factors led to the placement of gaming regulation in the Residual List of the Constitution. “As such, states that permit gaming have the inherent constitutional right to regulate gaming.  ASGRN  is  therefore calling on  NLRC  to  understand that  legally,  its  regulatory  power  only covers the ambit of the Federal Capital Territory and setting up a viable National Lottery to challenge  what  is  currently available  in  other countries along  the West African  Sub-region.”The body further disclosed that Ghana Lotto for instance is very popular in Nigeria and asked why Nigeria cannot float a similar lottery?” Reacting to the news that the States were making arrangements to float another body charged with the responsibility of issues regarding gaming taxes and licensing of gaming operators, Ogara said: “In   fullness   of   time   and   after   all   due   diligence   and   consultations   have   been concluded, we intend to establish a Joint Gaming Board (JGB) (one of the outcomes of the roundtable discussions between the States and NLRC), whose duty will be to harmonise and design a unified tax regime among the regulating states. On the issue of licenses, we shall leave it for the respective states to decide.”   Source: Guardian

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‘Ways to make digital transactions’ VAT work’

As the Federal Inland Revenue Service (FIRS) prepares to impose Value Added Tax (VAT) on online transactions, the questions on many lips is how can it work in Nigeria? “What Nigeria (FIRS) needs to do is to first study digital economy; What does it mean? In which different areas do we have it? What are the issues, difficulties in collecting its taxes? What is the best practice that has been adopted around the world? “ So advised Mr Taiwo Oyedele, a  partner with PwC on Tax and Regulatory services. “It is difficult to deal with digital economy, e-commerce inclusive. Even the largest and the most powerful economy in the World, the US, is still struggling with this digital economy. But they have gone a little bit ahead of the rest of us. So we can then borrow from some of their initiatives,”Oyedele added. The FIRS Chairman, Mr Babatunde Fowler, in far away New York, USA, recently said FIRS would soon begin collection of VAT on online transactions. According to him, “soon, we will ask banks to impose VAT on online transactions for purchases of goods and services.” He explained that the online transactions tax is something not new.  “It actually should be in existence. We will certainly follow up to make sure that every VAT that is due to be collected is collected, ” he stated, adding that the move was part of measures by FIRS to meet its N8 trillion revenue target for 2019. To heed Oyedele’s advice, let’s see how  this  VAT model is being practised in some climes: Remote sellers’ tax in US On June 21, 2018, the United States Supreme Court fundamentally changed the rules for collection of sales tax by Internet-based retailers. According to www.nolo.com, in its decision in South Dakota v. Wayfair Inc., the court stated that individual states can require online sellers to collect state sales tax on their sales. This ruling overturns the court’s 1992 decision in Quill Corporation v. North Dakota. The Quill case prohibited states from requiring a business to collect sales tax unless the business had a physical presence in the state. Online sales tax in UK Her Majesty’s Revenue and Customs (HMRC), the tax authority in the United Kingdom, as of 2017, approached sellers (on internet platforms) directly and via the marketplaces such as Amazon and eBay,  searching for non-VAT compliant non-UK sellers. According to SimplyVAT.com, quoted by blog.taxJar.com, if you are a non-resident UK business and hold stock in the UK, either in a 3PL centre such as Amazon, you have created a taxable supply and have an obligation to VAT register in the UK. If a seller has been trading in the UK for many years without a UK VAT number, HMRC does want the seller to pay the back taxes. Once a seller registers for VAT and has to catch up on a lot of historical returns , which means they will have a lot of back-dated taxes to pay, HMRC will give the seller time to pay as long as the seller offers a reasonable payment plan. Likely scenario in Nigeria In an interview with Daily Sun even before Fowler announced the plan, Oyedele painted a likely scenario in Nigeria this way “Take Amazon for example: if you want to order something from Amazon, you can open your computer now or your phone, just log on to the internet. And you can order. Now let’s say you order handset. The handset in Nigeria is liable to VAT. But Amazon is not a Nigerian company. It is supposed to charge VAT. They don’t even know whether there is VAT in Nigeria and they are not even interested. The phone is $50. They have not put VAT on it.   Source: Sun News

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‘Technology For Tax Collection Protects Traders, Checks Double Taxation’

The Edo State Governor, Mr. Godwin Obaseki, has said the state government’s insistence on the use of technology for tax collection as against non-state actors and consultants was to ensure that traders are protected from harassment and double taxation. He said his administration would strengthen ties with the Tax Appeal Tribunal, South-South Zone, to boost tax compliance in the state, especially with the recent influx of investors into the state. The governor disclosed this during a courtesy visit by the Chairman of Tax Appeal Tribunal, South-South Zone, Prof. Obehi Odiase-Alegimenlen, to Government House in Benin City. The governor explained that the ban placed on the use of consultants and non-state actors and the introduction of Information and Communication Technologies (ICT) for tax collection is aimed at protecting traders and other taxpayers from harassment and double taxation. “This move has led to a backlash, but we will not go back on that decision taken by this administration,” Obaseki added. Obaseki noted that taxation remains the main source of revenue for most states in the country, adding that any state focused on growing its internal economy must ensure that the people imbibe the culture of paying their taxes and demanding accountability from government. “I appeal that we work together on advocacy, especially in improving the communication mechanism to drive compliance. People ought to know the importance of paying taxes and that it is their civic responsibility,” he added. He said the state has undertaken significant reforms in tax administration and has implemented a series of initiatives in deploying technology for tax collection, which have made the process easier and more transparent. Obaseki explained, “We believe that we can introduce more technologies to drive transparency and make tax collection easier. People don’t want to pay taxes, forgetting that it is their civic responsibility as it helps to develop the economy.” The Chairman of the Tax Appeal Tribunal, South-South Zone, Prof. Obehi Odiase-Alegimenlen said the tribunal was set-up to resolve disputes from clients of tax authorities. “In the advanced world, taxation is a very important aspect of our development finance but not so in Nigeria. The Federal Government is trying to make taxation a relevant aspect of getting finance for developing the country,” he added.   Source: Punch

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Sanwo-Olu tasks institute on deepening taxation practice

Gov. Babajide Sanwo-Olu of Lagos State has tasked the Chartered Institute of Taxation of Nigeria (CITN) to be proactive on deepening taxation practice in Nigeria. The governor gave the advice at the Investiture of the 14th President of CITN, Dame Olajumoke Simplice, on Saturday in Lagos. Represented by Mrs Balogun Olufunmilayo, Permanent Secretary, Ministry of Finance, he said that deepening taxation practice would enhance revenue generation of the state and country. He said that his administration would partner the Institute to strengthen and encourage taxation system for enhanced economic development of the country. “CITN has immensely contributed to the growth of taxation in Nigeria, but the reward for hard work is more work. “The Institute should not relent on efforts to have an efficient taxation practice as is obtainable in other countries. “Tax is a civic responsibility of every citizen of a country and remains a major medium through which the government can generate funds to fulfill its electoral promises,” he said. The Chairman of the Federal Inland Revenue Service (FIRS), Mr Babatunde Fowler, said that the issue of deepening taxation was a global issue that Nigeria should key into. Fowler, who was a special guest of honour at the Investiture, said taxation was a social contract that enables citizens to play significant roles in raising revenue for government. “By paying taxes, government will similarly have a strong motivation to account for revenues collected and the utilisation of such revenues. “Voluntary compliance by the taxpayers will ensure that revenue is made available for improving on the provision of social amenities and services,” the FIRS boss said. Fowler affirmed that the CITN had advanced to an enviable stage when considered from the level it started operation in Lagos State. In her acceptance speech, Simplice promised to widen the corporate horizon of the Institute through the review of its vision and mission statement. She said the institute would develop and deepen the use of technology by ensuring a full-fledged ICT department as the backbone of its operations.  “Our vision to be the leading Institute in training world class Tax Professionals has been driven over the years through various capacity building programmes. “Going forward, it is intended that the Tax Academy will be developed to project this fundamental driving force of our vision. “The Tax Academy will be repositioned in terms of capacity for a technically driven alternative route to membership through intensive training for revenue services staff,” Simplice said. She congratulated all the newly elected members and encouraged them to take up challenges that would take the Institute to a greater level.   Source: Punch

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Tanzania Govt To Impose Tax On Wigs

A row has broken out in Tanzania over the government’s decision to impose a tax on wigs and hair extensions. Many male and some female MPs applauded and thumped their desks in approval when Finance Minister Philip Mpango announced the tax in parliament. Supporters of the levy say it will help women keep their hair natural. But there has also been public outrage, with women saying they are being punished for wanting to look good in wigs and hair extensions. Tanzanians tend to uphold traditional values, but society is changing and many women now wear wigs and extensions, the BBC’s Aboubakar Famau reports from the capital, Dodoma. In his budget speech in parliament on Thursday, Mr. Mpango announced a 25% tax on imported wigs and hair extensions and a 10% tax on those made locally as part of a series of measures aimed at increasing government revenue. The cheapest wigs currently costs around $4 (£3.40), but they can sell for up to $130. Mr. Mpango also scrapped the exemption on value-added tax placed on sanitary towels, saying consumers had not benefited as businesses did not reduce prices when it was introduced   Source: Hubnaija

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LIRS To Introduce Unique Biometrics-Based Identifier For Taxpayers

The Lagos State Internal Revenue Service (LIRS) has issued a public notice (the Notice) on its intention to integrate the LASG-EBS Taxpayer Identification Digit (PID) module into the National Tax Identification Number (TIN) system with the Joint Tax Board (JTB). The TIN module is biometrics-based, with the aim of ensuring identity uniqueness for taxpayers. The proposed integration is set to achieve the following objectives: Facilitate smooth sharing of taxpayers’ data for JTB, State Board Internal Revenue Services (SBIRS’s) and other stakeholders     Remove the incidence of multi payer ID     Simplify the taxpayers’ registration process     Provide a unified taxpayer database     Ease the tax payment process The Notice states that going forward, access to LASG-EBS platform for all transactions including but not limited to registration and creation of payer ID for new taxpayers, payment of taxes and validation of taxpayers’ profile shall compulsorily require taxpayers’ Bank Verification Number (BVN). The BVN provides LIRS the fastest and least disruptive route to achieving the planned integration with the JTB-TIN system. Based on the above, all self-employed individuals are required to provide their BVNs to LIRS in order to assist in the creation of their unique PID. Corporate organisations are also required to ensure that their employees who qualify for tax clearance certificate include their BVN in their individual e-TCC forms. The integration is expected to provide LIRS with a more reliable taxpayers’ database which will improve planning, reduce tax evasion and invariably increase tax revenue. In an attempt to address the potential reluctance of taxpayers to share personal and confidential information, LIRS has assured taxpayers of the safety and security of all data/information in its custody. Please click here for a copy of the public notice. We will continue to monitor developments on this issue and share further updates with you as they become available.   Source: Punch

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Unavailability of CAC documents stalls forgery trial of Obasanjo’s in-law

The unavailability of documents from the Corporate Affairs Commission (CAC) has stalled the forgery trial of John Abebe, the younger brother of former first lady, late Mrs Stella Obasanjo on Friday in an Ikeja Special Offences Court. Abebe is alleged by the Economic and Financial Crimes Commission (EFCC) to have on June 22, 2010 knowingly forged portions of a letter belonging to BP Exploration Nigeria Ltd dated Nov. 30,1995. Mr Christopher Ikem, a staff of CAC and the second defence witness (DW2), Informed the court that the CAC was still in the process of collating the documents necessary for Abebe’s defence. He noted that some of the documents date as far back as 1992. Mr Uche Nwokedi, SAN, the defence counsel, requested for an adjournment of the suit to enable the subpoenaed CAC official bring the necessary documents to court. Reacting, Mr Rotimi Oyedepo, the lead prosecuting counsel for the EFCC, however, expressed displeasure over the defence counsel’s request for an adjournment. “My lord the learned SAN can tender the documents himself we should not use DW2 as a skyscraper of adjournments. The documents about to be tendered has no relation to the charge. “It is alleged that the defendant forged a document that was presented during proceedings at the Federal High Court. “I humbly and passionately pray my lord that proceedings should not be stalled as justice is not for the defendant alone,” Oyedepo said. Responding Nwokedi said “We issued these subpoenas to the witnesses in May and this case is under constant review and we owe it to provide the best defence. “If my learned friend can state here that he has not sought an adjournment in this case, I will let it be. We were meant to take two witnesses today but unfortunately, the second witness is not well,” Obliging Nwokedi’s request, Justice Mojisola Dada adjourned the case until July 10 and 11 for continuation of trial. In a no-case submission which relied on Section 239(1) of the Administration of Criminal Justice Law 2011 Nwokedi (SAN) had urged the court to dismiss the EFCC’s case against Abebe. In the no-case submission which was dismissed by Justice Dada on March, 24 Nwokedi noted that the procurement of the allegedly forged letter by the prosecution was illegal. He said it contravenes the provisions of Sections 37 and 38 of the National Archives Act and as a result, the document (letter) was legally inadmissible to prove the charge against Abebe. He noted that the document, which was prepared by BP Exploration Nigeria Ltd and Inducon Nigeria Ltd (both Nigerian companies) were produced from a privately managed archive in London known as Iron Mountain. Abebe opened his defence on July 13 with Mrs Roseline Ovesuor, Deputy Director of the National Archives giving evidence and the first defence witness (DW1). Reiterating the claim of the defence, Ovesuor stated in her evidence that by virtue provisions of Sections 37 and 38 of the National Archives Act, it was an offence for a Nigerian company to take its records outside Nigeria. Abebe had on July 26, 2018 plead not guilty to a four-count charge of forgery, fabricating evidence, using fabricated evidence and attempt to pervert the cause of justice. According to the EFCC, the defendant committed the offence on June 22, 2010 in Lagos. “Abebe knowingly forged BP Exploration Nigeria Ltd’s letter dated Nov. 30,1995 to Inducon (Nigeria) Ltd. “He committed the forgery by inserting in page two of the said letter the following words: “Also note that the ‘Buy-Out Option’ only applies to the pre-production stage of the Net Profit Interest Agreement (NPIA). ”The four million dollars buy-out is thus irrelevant from production of oil in any of our fields. “He purported same to have been issued by BP Exploration Nigeria Limited,” Oyedepo said. The prosecution claims that the defendant used the allegedly forged letter as evidence in suit No. FHC/L/CS/224/2010 between Abebe, Inducon Nigeria Ltd and Statoil Nigeria Ltd. at the Federal High Court. The evidence was admitted and marked exhibit BB in the suit. According to the EFCC, the defendant had through his actions, attempted to pervert the course of justice. The offence, the anti graft agency said, contravened the provisions of sections 120(1), 120(2), 126(2) of the Criminal Code Law of 2003.(NAN).   Source: Vangard

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