From Uche Usim, Abuja
The Federal Inland Revenue Service (FIRS) on Monday said it created 35 additional tax audit units last year to frontally tackle illicit financial flow out of Nigeria and improve tax compliance rate in the country.
Its Executive Chairman, Mr. Muhammad Nami, disclosed this in Abuja on Monday in his opening remarks at a workshop on Effective Audit of Multinational Corporations for Domestic Revenue Mobilisation in Nigeria, organized by the service in conjunction with the Tax Justice Network.
Although Nami observed that some multinational corporations were leading in tax compliance in various sectors, he, however, expressed worries that many rich multinational corporations do not pay the right taxes due from them, let alone pay their taxes voluntarily.
Charging the workshop to come up with a novel methodology that would be used to uncover illicit financial flows and provide an overview of related policy options for enhancing tax revenue collection in general, Nami also disclosed that between 2007 and 2017, Nigeria was reported to have lost over US$178 billion (about N5.4 trillion at today’s rate) through tax evasion by multinationals doing business in the country.
He also cited a 2014 report by the High-Level Panel on Illicit Financial Flows from Africa, which stated that Nigeria accounted for 30.5 per cent of money lost by the continent through illicit financial flows.
His said: “At the FIRS, we are paying greater attention to tax audit in general and Transfer Pricing audit in particular in order to improve the level of tax compliance in the country. As a result, in the last one year, we have created more than 35 additional Tax Audit Units and deployed experienced and capable staff to take charge of these offices.”
Nami further stated that with signing of the 2021 budget of N13.588 trillion on December 31, 2020, by President Muhammadu Buhari and given the recent decline of oil resources, “which had been the major revenue earner for the country, taxation is expected to continue to shoulder the government’s budget performance the way it did in 2020.