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Nigeria loses N5.4tn to tax evasion by multinational companies

In seven years, Nigeria has lost about N5.4 trillion through tax evasion by the multinational companies doing business in Nigeria.   The Executive Chairman of the Federal Inland Revenue Service (FIRS), Muhammad Nami, who made this disclosure, cited a 2014 report by the High-Level Panel on Illicit Financial Flows from Africa, which stated that Nigeria accounted for 30.5 per cent of money lost by the continent through illicit financial flows.

To check this, he said the FIRS has created 35 more tax audit units to stem illicit financial flow out of Nigeria and improve tax compliance rate.

In a statement signed by FIRS Director, Communications and Liaison Department, Abdullahi Ahmad, Tuesday, after a workshop on effective audit of multinational corporations for domestic revenue mobilization in Nigeria, organized by FIRS, in conjunction with the Tax Justice Network, Nami said some multinational corporations were leading in tax compliance in various sectors but many rich multinational corporations were not paying the right taxes due from them,  and did not pay these taxes voluntarily.

He encouraged participants at the workshop to come up with new ideas to uncover illicit financial flows and provide an overview of related policy options for enhancing tax revenue collection.

Nami said  the FIRS was paying greater attention to tax audit in general and transfer pricing audit in particular to improve the level of tax compliance in the country.

According to him, with the signing of the 2021 budget of N13.588 trillion and given the recent decline of oil fortunes, which had been the major revenue earner for the country, taxation is expected to continue to shoulder the government’s budget performance as  it did in 2020.

 

 

 

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