The Federal Government, yesterday, gave tax defaulters in the country March 31, 2018, deadline to pay up their taxes or face prosecution.
It also warned them to voluntarily declare their assets and income or face the consequences of refusal to do same.
Acting President, Prof. Yemi Osinbajo, who handed down the ultimatum at the launch of the Voluntary Assets and Income Declaration Scheme, in Abuja, disclosed that the administration had gathered financial intelligence on the assets of Nigerians at home and abroad in the last 15 months.
He noted that only 214 people were paying an annual tax of N20 million voluntarily which, according to him, is a far cry from the large number of high net-worth people in the country.
Osinbajo, who also noted that all those in this category were resident in Lagos, said the Voluntary Assets and Income Declaration Scheme, VAIDS, which Executive Order was signed on the occasion, would create room for defaulters to get registered and pay their taxes between July 1 and March 31, 2018.
He said the government had built a database of the assets of Nigerians, including those held in tax havens across the globe, and would go after defaulters after the March 31, 2018, deadline.
The acting President warned that anyone who failed to take advantage of the window would face dire consequences.
He said: “The project has engaged, on retainership, one of the world’s leading assets tracing firms. Nigeria has also solicited for inputs from various nations who have availed us data under the various conventions and treaties which we have signed.
“The project has been able to create accurate financial profiles of thousands of Nigerian companies and individuals, which show various levels of non-compliance.
“Tax evasion is not just a civil matter, it is also a crime. Nigeria is now party to the Automatic Exchange of Information, which comes into effect in 2018.
“This means that Nigeria will automatically have information required to successfully pursue tax evaders across the world. Specifically, we will have access to information on beneficiaries and owners of assets held abroad, including tax havens.
“Based on information that is now available, our preference is that those that have diverted Nigeria’s resources to tax havens abroad or concealed them in Nigeria should face the full force of the law.
‘’VAIDS will be operated from July 1, 2017 to March 31, 2018. It will be supported by an Executive Order that I will sign into law today.
On the statistics of tax payers, Osinbajo said: “According to the Federal Inland Revenue Service, the total number of tax payers in Nigeria is just 14 million. Out of this number, 96 per cent have their taxes deducted at source from their salaries.
“Only four per cent comply under direct assessment. So, the vast majority of Nigerians do not pay taxes. This is at variance with the structure of our economy where we are estimating that almost 70 million Nigerians are economically active”.
”That means that only 20 per cent of the people engaged in one form of business or the other are registered and paying tax”.
Osinbajo noted that the problem of tax evasion was not limited to only the rich, adding, however, that the nation practiced a progressive taxation in which the rich pay more, while low income earners pay less but that everyone must pay taxes.
He also declared every Thursday as Tax Awareness Day, with a view to increasing tax education across the nation. He urged the governors to support the programme, saying it would directly impact state revenues.
