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Published On: Fri, Jul 5th, 2019

Tax evasion: Kaduna govt. recovers N9.4bn from FG agencies

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From: Femi Oyelola, Kaduna

The Kaduna State Internal Revenue Service (KDIRS) said it has recovered N9.4billion Pay-As-You-Earn (PAYE) and withheld tax liabilities from Federal Government agencies in the state.
Mr Francis Kozah, KDIRS’s Board Secretary and Legal Adviser, made this known in an interview with news men in Kaduna yesterday
Kozah described the development as the “biggest recovery in the history of the revenue agency”.
He noted that KDIRS had conducted Tax Audits on Federal Ministries, Departments and Agencies (MDAs) in Kaduna State, from 2007 to 2014.
The official said that when the All Progressives Congress-led government took over in 2015, the revenue agency revisited the issue, looked at the audit report vis-à-vis the provisions of the law and updated it.
He said the exercise led to the establishment of liabilities on PAYE and withholding taxes on the MDAs, to the tune of N13.9 billion.
Kozah identified the MDAs to include Nigerian Defence Academy, Nigerian Railway Property Management Company, National Eye Centre, National Youth Service Corps and National Animal Production Research Institute.
Others are Ahmadu Bello University, Ahmadu Bello University Teaching Hospital and Kaduna Polytechnic.
He said the recovery took a very long time to come to fruition because the MDAs were not willing to pay the arrears, particularly Ahmadu Bello University and Kaduna Polytechnic.
“The N13.9 billion liabilities were duly communicated to them through the issuance and service of Demand Notices as required by law, followed by several meetings, to avoid recourse to court.
“Some of the MDAs claimed their remittances were based on the understanding they had with the previous government, which was greatly shortchanging the Kaduna State Government.
“We responded that any agreement to pay below the statutory rate fixed by law was illegal and, therefore, not enforceable.
“In fact, we had to take some of the notorious agencies to the Tax Appeal Tribunal and Revenue Courts, while exploiting other alternative avenues of amicable resolution,” he said.
The legal adviser said that when all avenues failed, KDIRS took the matter to the Federal Ministry of Finance, Office of the Accountant-General of the Federation and Federal Inland Revenue Service, among others.
“After our discussions, they sent their consultants to verify our claims, which they did.
“But in the spirit of amicable resolution, they pleaded with us to forgo the penalty and interest for not remitting the arrears as and when due, and we did.
“In all, our arrears stood at N9.4 billion, which we have recovered; and same was paid into the Kaduna State Treasury Single Account.
“KDIRS will, therefore, withdraw all cases against the federal MDAs before the Tax Appeal Tribunal and Revenue Courts,” he said.
The Acting Executive Chairman, KDIRS, Malam Ahmad Salihu, described the development as an “eloquent testimony and a warning to all defaulting taxpayers in the state.
“This goes to show that, as far as tax is concerned in Kaduna State, you can only run but you cannot hide. You will certainly be caught.
“I am sure the affected agencies must have realised now that their delay was in vein, because the government has paid the money and it will be debited from their subvention.
“I, therefore, advise all taxpayers in Kaduna State to comply with the state’s law, for the good of all.” He said

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