Oil price crash will discipline Nigeria – Lamorde

30 November 2014, Abuja – The Economic and Financial Crimes Commission (EFCC) has said the current crash of global oil prices will discipline Nigeria in the area of naked display of corruption through tax evasion.

The Chairman of EFCC, Ibrahim Lamorde, stated this at the ongoing seminar on Tax Crime Investigation and Prosecution Course organised by the United Nations Office on Drugs and Crime (UNODC) in conjunction with the European Union (EU).

Oil-worldLamorde explained that going by a recent investigation conducted by the EFCC, “only few individuals and institutions pay tax; most businesses don’t pay their tax, people drive N50 million car and you ask them for taxes, they don’t pay. It is good that oil price is going down so that we look elsewhere.”

He said the commission’s effort in confronting tax evasion “led to an immediate recovery of over N3 billion. Our experience was very revealing, as only a very few individuals and institutions pay tax.

He observed that only “employees in structured salaried employment, whose taxes are deducted from source, pay. Most businesses do not pay tax and where they are recipients of value added tax (VAT), same is not remitted and is laundered back through the business as legitimate earnings. We have also realised from the position of the NFIU that there is a linkage between tax evasion and AML/CFT. Consequently, billions of Naira are lost to the Government of Nigeria and it is possible that these lost revenues could be laundered and used for criminal purposes.

“The power to tax is what defines the sovereignty of a country. It is the key attribute of sovereignty and statehood. Conversely, it is the payment of tax that empowers and legitimises the right of a citizen to ask for accountability of Government. I suspect that if the citizenry were paying taxes, the level of impunity in the political arena would be significantly minimised as the citizen would feel embezzlement personally and demand for accountability,” Lamorde said.

Speaking also, UNODC Project Coordinator on Anti-Corruption, Bala Sanga, said the growing cases of terrorism funding and money laundering have become alarming, stressing the need to train experts on tax evasion and fraud.

Sanga told journalists that “chances are that anywhere you see tax evasion, you are going to see money laundering and cases of underlying corruption.”

He said though the UNODC do not meddle in the internal affairs of countries, but it is concerned with the rise in crimes such as tax evasion, terrorism funding and money laundering.

Sanga stated that the training would afford the UNODC an opportunity “to tutor law enforcement and anti-corruption agencies on intelligence led procedures for investigating corruption.”

President of the Chartered Institute of Taxation of Nigeria (CITN), Chief Mark Anthony Dike said non-tax compliance is capable of derailing Nigeria’s developmental agenda.
“It is quite glaring that the level of tax compliance in Nigeria is abysmally low. This has greatly impeded development as government at all levels in Nigeria have had to contend with paucity of the execution of the plethora of projects begging for attention.
Our reliance on revenue from oil and other hydro carbon sources has been our bane. Taking a look at the revised Gross Domestic Product (GDP) of Nigeria recently, the percentage of taxes to GDP is a far cry from what it should be. Therefore, every effort to rein in more taxes and increase compliance is a welcome development,” Dike said.

– This Day

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