N50bn Tax Evasion; Senate summons bank MDs
The Senate Committee on the Federal Capital Territory Administration (FCTA) has summoned the managing directors of commercial banks operating in the territory over their banks’ failure to remit taxes in excess of N50 billion.
Chairman of the committee, Senator Dino Melaye, made the disclosure on Tuesday in Abuja at a meeting of his committee with the FCTA Ministry, Federal Inland Revenue Service (FIRS), and the Ministry of Justice.
The meeting began on a dramatic note when Senator Melaye walked out a Deputy Director in the Ministry of Justice, Ms. Memuna Shira who appeared for her boss, the Attorney-General and Minister of Justice, Abubakar Malami (SAN).
Melaye stated that as the chief law officer, the Attorney
General should have known the constitutional implications of not honouring an invitation from the Senate, the highest lawmaking body in the country, much less send a Deputy Director to appear in his stead.
“We will not allow anybody or institution to take the Senate for granted. For the AGF, it is even worse. Nobody should know the law better and understand the nation’s constitution better than the AGF. If he’s not here at the end of this meeting, we shall give a consequential order,” Melaye stressed.
However, a few minutes after handing down the threat, the minister showed up, apologising profusely that the Deputy Director was only to inform the senators that he would be late in coming, in addition to an earlier letter conveying the same message, and not to represent him.
On the issue of over N50 billion which was alleged to be unremitted taxes by banks operating in the FCT, Melaye directed that the bank chiefs would have to appear before his panel to explain how they intend to clear the backlog which he stressed was important for the financial health of the FCT in the face of dwindling allocations from the Federation Account.
He regretted that the FCT was still struggling to become a world class city, over 40 years after its creation.
Melaye stated that the situation was worsened by the astronomical rise in the population of Abuja from a mere two million in 1999 to over 12 million in 2016.
In his submission, the FCT Minister, Alhaji Mohammed Musa Bello, disclosed that his administration realised over N28 billion as Internally-Generated Revenue (IGR) in 2016 against the N21 billion projected in the budget.
He noted that the administration’s failure to appoint an IGR Board since President Muhammadu Buhari dissolved all boards in mid-2015 as a challenge to the remittance of taxes by individuals and organisations in the FCT.
According to the minister, the absence of an IGR Board prompted his administration to partner with the Federal Inland Revenue Service (FIRS) in the collection of taxes on the understanding that FIRS would take 4% commission on all remittances.
Bello’s disclosure drew the ire of members of the committee, with Senator John Enoh (PDP Cross River) insisting that the failure to set up an IGR Board for the FCT close to two years “made it seem like rocket science.”
He maintained that the failure to set up such a board to collect taxes on behalf of the FCT appeared to make the minister comfortable with the paltry allocations from the Federation Account.