From Uche Usim, Abuja
The Federal Inland Revenue Service (FIRS) says it is ready to recover unremitted tax deductions detained in the coffers of some states and local governments.
FIRS said it will consequently advise the Federal Government and the Finance Ministry, to henceforth decline approval of any request for the issuance of state bonds or other securities in the capital market; as well as requests for external borrowing and approval for domestic loans from commercial banks or other financial institutions by state and local governments with outstanding unremitted tax deductions.
The tax authority, in a notice, signed by its Chairman, Muhammad Nami, stated that it would also publicly name and shame the defaulting states and local governments while publishing the amounts owed in unremitted tax deductions.
It further revealed that it would also invoke the provisions of Section 24 of its Establishment Act which empowers the Accountant General of the Federation to deduct at source, from the monthly FAAC allocations, unremitted taxes due from any government agency and to thereafter transfer such deductions to the Federation Account and notify the service.
The FIRS thus called on all defaulting states and local governments to promptly remit all unremitted tax deductions within 30 days of the publication of the Notice to avoid it taking these enforcement actions.
The notice noted that some states and LGAs failed to remit to the Service Withholding Tax (WHT) and Value Added Tax (VAT) deductions from payments made to contractors and service providers by them as required by law.