The Federal Inland Revenue Service has commenced a back-end tax audit on operators in the maritime and aviation industries in a bid to unmask tax defaulting firms in the oil lifting and shipping sector.
The Executive Chairman of FIRS, Muhammad Nami, said in an address at the Pedabo Thought Leadership Breakfast Session held in Lagos, on Thursday, that the exercise being carried out in collaboration with regulatory authorities in the industries, was at advanced stage.
Therefore, Nami urged foreign players in the industries lifting cargoes out of Nigeria without paying taxes to regularise their tax standing.
He said, “Let me use this opportunity to invite all foreign companies that have lifted cargoes (including crude oil) out of Nigeria without paying tax in line with extant law to voluntarily come forward to regularise their tax positions.
“Those who would wait for FIRS’ audit before doing the right thing may find the taste very unsavoury.”
He noted that the maritime and aviation industries were not yielding the expected revenue to the treasury, saying that this was as a result of the failure of foreign companies to pay tax.
“The low tax revenue performance of the two industries can be attributed to many factors, chief of which is the failure of foreign companies lifting cargoes (particularly, crude oil) to pay tax.
“This is contrary to the provisions of the extant tax laws. The revenue leakage from these non-compliant companies is very huge.
“Tax authorities are unable to police these foreign companies because the transportation contracts are executed outside Nigeria and the tax authorities do not have the lifting schedules of the vessels ahead of their arrival in Nigeria,” he said.
He stated that governments’ existence and socio-economic development across the world were defined by tax as taxation was beyond a mere tool for raising revenue or a mere civil obligation of citizens.
