The Federal Inland Revenue Service (FIRS) has given Ministries, Departments and Agencies (MDAs) of government six months to clear outstanding taxes generated on behalf of the Federal Government (FG) of Nigeria.
Failure by these MDAs to pay on the stated date would compel the service to invoke provisions of Section 24 of the FIRS (Establishment) Act, 2007 (as amended) and Section 83 of the CITA Cap. C21, LFN, 2004 to request the Accountant General of the Federation to deduct unremitted taxes from the budgetary allocation of defaulting MDAs.
In a notice to the agency titled, ‘Payment of outstanding taxes by Ministries, Departments and Agencies (MDAs) of the Federal, State and Local Governments,’ the Chairman of FIRS, Muhammed Nami, directed all affected agencies to pay the outstanding taxes within six months after the notice.
Nami noted that “Sections 78, 79, 80, 81 and 82 of the Companies Income Tax Act (CITA) Cap. C21, Laws of the Federation of Nigeria (LFN), 2004 (as amended) and Section 13 of the Value Added Tax (VAT) Act Cap. V1, Laws of the Federation of Nigeria (LFN), 2004 (as amended)” obligated MDAs, to deduct and withhold taxes on payments which are to be remitted to the FIRS.
He added that the Service may also resort to the provisions of Section 31 of the FIRS Act to recover taxes due from a defaulting MDA through assets in the custody of any person.
He said penalties and interest on all outstanding taxes would be recovered along with the principal tax liabilities.
When contacted on the estimated unremitted taxes and the duration by the MDAs, FIRS Director of Communication and Liaison, Abdullahi Ismaila Ahmad, did not pick his calls. He however, through a response to a text message, said the details were not available.