The non-remittance of tax deductions by Ministries, Departments and Agencies of government (MDA) as well as the House of Representatives and Senate led to the loss of tax revenue of N5.8bn by the Federal Inland Revenue Service in 2019.
The Office of the Auditor General of the Federation released this statement in its 2019 Annual Report on non-compliance, internal control, and weakness issues in MDAs of the Federal Government of Nigeria for the year ended December 31, 2019.
The MDAs are the Federal Ministry of Agriculture and Rural Development; Federal College of Freshwater Fisheries Technology, New Bussa; Advertising Practitioners Council of Nigeria; Nigerian Civil Aviation Authority; Nigerian Communications Satellite Limited,
Hussaini Adamu Federal Polytechnic, Jigawa State; Federal Medical Centre, Keffi, Nasarawa State’ Department of Petroleum Resources; National Assembly Service Commission; and Nigerian Correctional Service.
The report stated that between 2018 and 2019, the MDAs refused to remit their one per cent stamp duty, value added tax, withholding tax or Pay As You Earn tax that are deducted from their awarded contracts, hereby braching sections of the Financial Regulations and Treasury Circular issued on December 29, 2015.
According to the Paragraph 234(I) of the Financial Regulations states that ‘it is mandatory for accounting officers to ensure full compliance with the dual roles of making provision for the Value Added Tax and withholding tax due on supply and services contract and actual remittance of same’.
It quoted Paragraph 235 as saying, “Deduction of VAT, WHT, and PAYE shall be remitted to Federal Inland Revenue Service at the same time the payee who is the subject of deduction is paid.”
It said, “The audit observed that the sum of N5,828,621,715.06 was the amount of taxes not remitted by 12 Ministries, Departments and Agencies.
“The Nigerian Civil Aviation Authority has the highest amount of N2,984,887,250.00 while Federal College of Freshwater Fisheries Technology, New Bussa has the least amount of N1,021,011.13.”
