United efforts to boost non-oil revenue paid off recently as the Federal Inland Revenue Service, said it had recovered over N97.7 billion from tax defaulters since it gave the directive to banks to slam a lien on tax defaulters’ bank accounts.
The figure was generated from 3,976 out of 44,293 non-tax compliant companies.
The Executive Chairman, FIRS Mr Babatunde Fowler, made the remark at the just-concluded 49th annual accountants conference of the Institute of Chartered Accountants of Nigeria in Abuja.
His disclosure was contained in his presentation titled; “FIRS power of substitution: Critical review and matters arising.”
Giving a breakdown of the money recovered, he said that through the banking turnover exercise, the Service recovered N88.59bn after reaching agreement with 3,797 out of 42,736 companies.
In addition to that, he said that 74 out of 406 companies have paid about N4 billion under the special tax audit substitution exercise.
Fowler added that the FIRS realised N3.8 billion after reaching agreement with 79 out of 800 companies under the VAIDs substitution exercise.
He said that through the special investigation substitution exercise, 47 out of 351 companies have paid N2.06 billion.
He said: “As at today, there are a total of 23,141 tax defaulters who are yet to come forward to clear their outstanding liabilities of about N254 billion.
“FIRS in collaboration with the banks have started engaging in compliance measures with regards to the tax defaulters and their accounts.
“Failure to carry out this directive will result in the banks being sanctioned according to Section 31 subsection 1-3 and 32 respectively of FIRS Act 2007.
He said failure to comply would be seen as an act of economic crime to the nation, adding that FIRS would be left with no option than to enforce its rights and apply appropriate sanctions.
“The sanctions will commence with delisting of the bank from FIRS collection list”, he added.
According to him, the FIRS has intensified its efforts to collect taxes from default payers by appointing banks and other financial institutions as collection agents under the tax substitution programme.
The banks as tax collecting agents were directed to make specific deductions from alleged tax defaulters’ accounts and remit to the FIRS in full or partial payment format.
However, that approach has come under heavy criticism by various stakeholders who query the legality of FIRS’ actions.
But Fowler in his presentation, stoutly defended his organization, insisting that he will do toe all legitimate paths to swell government’s revenue via improved tax collections.
While acknowledging that the approach may be perceived unfriendly, the FIRS boss insisted that the federal government had given defaulters a tax amnesty programmes like the Voluntary Assets and Income Declaration Scheme (VAIDS) which they failed to take advantage of.
He said that through the substitution exercises, FIRS increased tax revenue collection through special tax audit, VAIDs, special investigation and the banking turnover initiatives.
The FIRS boss also cautioned the banks against sabotaging his order to restrict access to specific bank accounts.