Tax news

Some traders at the popular Oshodi Market on Thursday identified multiple taxations, the absence of parking space and threats by touts as some of the pressing challenges facing traders in the market. Traders in interviews with the News Agency of Nigeria at Oshodi said that these challenges were affecting their profit margin. Alhaji Tajudeen Lateef, the Vice-Chairman (Babaloja) of Oshodi Market, explained that businesses in the market also suffer from a lack of access to loans.      “All we see in the market is various taxes that we don’t even understand, and you honestly can’t challenge them, you just have to pay. “This is minus shop permit that we pay yearly. If I begin to explain these levies, I will get you confused because I equally do not have a solid understanding. “Secondly we all know as business people we need loans to assist us from time to time, that Tradermoni initiative from the government is not helping traders much. “I can spend N10,000 in a day, what they should have done is to assess your store and see how much it is worth. “When I took a loan of N1,000,000 from a micro-finance bank I know how much I had to pay back in return. Make loans accessible to market men and women with low interest,’’ he said. The Woman Leader (Iyaloja) of Oshodi Market, Alhaja Sikirat Adeyanju, urged the government to help fast track the construction of the ongoing parking space and provide good road network. “Most of the time, our customers complain bitterly about the absence of parking space in the market. ”They find it difficult coming to shop here when they remember that the safety of their cars can’t be guaranteed,’’ she said. A market woman, who spoke on condition of anonymity, told NAN that touts, known as “area boys“, reign in the market with so much impunity. “We can’t talk about this, because our lives will be in danger. Do you know that in this market, area boys can just walk into your shop and pick anything that they like and nothing will happen? “You can’t challenge them, because they have godfathers. Women are the main target because by nature we can’t start fighting with tugs. “Our security is at risk daily and it’s so worrisome. Being a tout is fast becoming a lifestyle among our youths and the young impressionable minds,’’ she said. Reacting to the allegations, Mr Olugbenga Oyekan, the Market Master at the Oshodi-Isolo Local Government Council Development Area (LCDA) said measures are in place to address the challenges. “As for good road channel, it is part of our budget; we are just waiting for the raining season to stop, so we can commence the reconstruction. “Also for taxation, I honestly don’t see multiple taxations as an issue. The truth is initially we tax N5,000 and we increased it to N6,200 and those with bigger stores pay N8,000,’’ he said.   Source: Punch

Former Super Eagles’ playmaker, Augustine Jay Jay Okocha, accused by Lagos State Government of income tax evasion has finally settled with the Lagos taxman. A Lagos State Prosecutor, Mrs Y. A. Pitan, told an Igbosere High Court on Wednesday in Lagos that the Lagos Internal Revenue Service informed it that Okocha visited its office and reconciled his accounts. Pitan then prayed the court for an adjournment to enable her file a notice of discontinuance of the charge preferred against him.         Justice Adedayo Akintoye, consequently, withdrew the warrant of arrest earlier issued on the defendant. She adjourned further hearing until Nov. 14, to enable prosecution file notice of discontinuance of the charge. The prosecutor had on May 28, informed the court that the defendant visited the office of LIRS to reconcile his accounts. The prosecutor then said that the defendant could not reach a common ground with the agency. The prosecutor then filed a three-count charge against Okocha on June 6, 2017, accusing him of: “Failure to furnish returns of income for tax purposes with the LIRS, and failure to pay income tax. “The offences contravene Section 56(a) and (b) of the Lagos State Revenue Administration Law No. 8 of 2006 and Section 94 (1) of the Personal Income Tax Act Cap P8 Laws of the Federal Republic of Nigeria 2004 (As Amended)”   Source: PM News

The chairman, Kaduna State Internal Revenue Services, Zaid Abubakar, has said more than 30,000 companies in the state do not pay their taxes. He said this on Tuesday in Kaduna when a civil society organisation, Tax Justice and Governance Platform, paid him a courtesy visit.        He noted that only a few paid their taxes, adding that many did not pay what they were due to pay. Abubakar also said that the 23 local government areas of the state had yet to remit the arrears of their Pay-As-You-Earn between 2013 and 2014. He added that plan had been concluded to audit the LGAs from 2015 to 2018 financial years.  The Chairman said, “People are not paying taxes. For example, if we put it in ratio 1-10, Kaduna is not even in 4th. We are going to do a lot of awareness and we may upgrade to enforcement which is captured in the tax laws.  “2013-2014 liability is still hanging on all the 23 LGs. All LGs have backlogs of remittances of PAYE and withholding taxes.”   Source: Punch

The senator representing Abia-South Senatorial District of Abia State in the Senate, Enyinnaya Abaribe, has described the 2020 budget as “nothing but a budget of taxation.” The senator added that the budget is not “sustainable.” President Muhammadu Buhari presented the 2020 Appropriation Bill to the joint sitting of the National Assembly on Tuesday. He had christened it ‘Budget of Sustaining Growth and Job Creation.’      However, Abaribe, speaking at the Senate plenary on Wednesday, told the Red Chamber, “This is nothing but a budget of taxation. “I urge the Senate to look at that fact, as it is not a sustainable budget.” He hinged his reason on the ratio of debt servicing, compared to that of capital expenditure. Abaribe argued, “Debt servicing is higher than capital expenditure. We are still struggling.” A former Governor of Benue State who now represents Benue North-East Senatorial District at the Senate, Gabriel Suswam, supports Abaribe’s observation. Suswam said, “I commend Mr. President for bringing an ambitious budget; the deficit worries me, there is a correspondence borrowing increase; we need to do something in this Chamber by way of legislation to address borrowing.” However, Senator Aliyu Sabi Abdullahi (Niger North), saw things differently. To him, “This is a budget of continued change. This government is on the right trajectory. “This budget has addressed how the micro and medium small enterprises will play a key role in building the Nigerian economy.” Continuing, Abdullahi said, “This budget will continue the change and ensure our citizens see a better economy.”   Source: Punch

The Minister of Works, Babatunde Fashola, announced plans for a return to toll plazas across the country last week, and the ministry has hurriedly tabled a proposal for its inclusion into the 2020 Appropriation Bill being considered for approval at the National Assembly this same week. Fashola had earlier made clear to the media, “There is no law that abolishes tolling in Nigeria today. We expect to return toll plazas.        We have concluded their designs, what they will look like, what materials they will be built with, and what new considerations must go into them”. The minister is right on the law, in the sense that the decision to scrap toll plazas was made through an Executive Order by former President Olusegun Obasanjo in 2004. An Executive Order, once made, can be overturned by another Executive Order without further ado. That, indeed, is the law, but since when did the minister conclude that public expenditure should be rammed through the national budget for no other reason but what he (the Executive branch) can do? Especially one that involves millions of road users, with considerable revenue and tax implications? Since when did the minister conclude that widespread public consultation be waved aside, over such a major roadwork plan, impacting the taxpayers on such a huge scale? What feasibility/viability study has the minister and his team conducted? What research has taken place? How many of the stakeholders have they communicated with? What cost-benefit analysis has been done? How about the environmental impact assessment? Impact on the poor? Questions, of course, that members of the Appropriation Committee of the National Assembly should not allow the minister to duck even this late in the day. That said, the rest of the discussion here will proceed on the assumption that the minister means well. While his intention is, by all account, honourable and beyond reproach on this issue, his tactic and approach however, are highly questionable. You cannot embark upon such a major reversal of policy by fiat. He has made no reference to any public consultation or input from stakeholders whatsoever. This appears to be just his own “brilliant” idea to generate funds for the country’s severely dilapidated and indeed dangerous road networks across the country. Almost 80% of Nigeria’s road network can be considered worn out, some are indeed death traps, full of potholes, cracks and creeks along the hedges. No point going too much into details; it is something everyone is familiar with. The reason for this is not just a lack of government investment in road infrastructure, it is also that the scale of the investment needed far exceeds anything government alone can shoulder at this point in time. There is also the important element of mismanagement and misappropriation of funds earmarked for roadwork happening routinely across the federation. So, why not embark upon a scheme, Public- Private-Partnership, to lure private investors with all types of juicy tax breaks, and allow them to put their own money into a project that will benefit them and the public at large, so the thinking goes. It is a no brainer, is it not? Any serious review of the scheme must start by examining the reason(s) for the abolition of toll plazas in the first place. They were abolished in 2004 because there was no economic case for their existence. What started as an American copycat scheme soon became entangled in fraud, incompetence and was generally burdensome. Not a single person bemoaned their abolition when it was announced. Now, before we rush through a reversal of policy, has the mischief involved in the original design been cured? Why is the minister trying to evade proper public scrutiny of his plan if indeed he is so confident of its merit? Why try goading the National Assembly to rubber stamp a scheme steamrollered through a committee in a last-minute attempt? If approved, the minister would be rightly applauded for being smart, and on the ball, of course. But, it is not certain what the members of the Appropriation Committee would be credited for though. Dereliction of duty, maybe? Tolling roads is not the magic bullet that some people think it is. It may be progressive, regressive or neutral depending on the social demographics of the area being targeted, as well as the structure of the tolling regime itself. Road toll in high-income communities, such as the Lekki-Ikoyi Link Bridge, in Lagos, for instance, is progressive as it mainly affects high income motorists, who generally value time more than the increased cost of travelling. If you install toll plazas in densely populated areas, where the poor would have no choice of routes, as is currently being planned, then, the tax (or toll) becomes essentially regressive because the poor will lose out in absolute terms. The loss is only ameliorated if the revenue generated from it is ploughed back into construction and maintenance, creating job opportunities for workers. It is not clear from the minister’s point of view, how this calculation has been made.   Source: Punch