Chairman of the Federal In-land Revenue Service (FIRS), Tunde Fowler, has urged members of the Institute of Directors (IoD) to take advantage of the Voluntary Assets and Income Declaration Scheme (VAIDS) as tax evasion will no longer be allowed.
Fowler gave the advice in Lagos while making a presentation on the tax amnesty scheme to IoD members.
In the presentation titled: “Achieving Voluntary Tax Compliance: The VAIDS Option”, the FIRS chief explained that the key motivation for introducing the scheme is that the country’s tax remittance rate remains low despite having some of Africa’s most profitable and well capitalised companies.
“Nigeria’s low tax revenues are inconsistent with the lifestyles and spending habits of a large number of citizens. Many are engaged in transfer of assets overseas, use of offshore companies in tax havens and registration of assets in nominee names,” he said.
He noted that tax evasion constitutes a significant challenge to the government and listed a number of ways through which taxes are evaded. Among these, he said, are manipulation of accounting records, use of complex structures for transactions, non-registration for Value Added Tax (VAT), non-payment of Capital Gains Tax ( CGT) on asset disposal and escaping detection of income due to lack of machinery for tracing such.
The FIRS boss, however, warned that under VAIDS, tax evaders will not escape. He explained that the Federal Ministry of Finance, in collaboration with relevant tax authorities, is building a revenue assurance platform through extensive gathering of data from sources that include Bank Verification Number (BVN), Nigerian Financial Intelligence Unit (NFIU), Corporate Affairs Commission (CAC), land allocation and land ownership records, foreign exchange allocation returns and bureaux de change records.