By Obas Esiedesa, Abuja
Executive Secretary of the Nigeria Extractive Industries Transparency Initiative (NEITI), Dr. Orji Ogbonnaya Orji has explained that the recent Memorandum of Understanding (M0Us) signed by NEITI with anti-corruption agencies in the country would help Nigeria recover about N2.6 trillion from 77 oil and gas companies.
The amount is owed by the companies through unremitted petroleum profit tax, company income tax, education tax, value added tax, withholding tax, royalty and concession on rentals. The debts were uncovered by NEITI audits of the sector.
Dr. Orji who spoke in Abuja, yesterday, at a briefing to introduce members of NEITI’s new board to journalists said the agency would work with the Economic and Financial Crimes Commission (EFCC), Independent Corrupt Practices and Other Related Offences Commission (ICPC), and Nigerian Financial Intelligence Unit (NFIU) to ensure that the money was recovered for the government.
He said: “The NEITI reports based on findings in its 2019 audit reports of the oil and gas sector show that oil and gas companies in Nigeria owe government about $6.48 billion which equals about N2.659 trillion at today’s exchange rate of N410.35.
“Data available to NEITI indicates that 77 companies (including international and Nigerian owned oil and gas companies) owe these debts which arise from failure to remit petroleum profit tax, company income tax, education tax, value added tax, withholding tax, royalty and concession on rentals.
“This debt is at a time that government is borrowing money to fund the provision and upgrade of infrastructure for Nigerians, uplift their standards of living, provide steady power supply and access to good roads, quality healthcare and security.
“A breakdown of the figures shows that a total of $143.99 million is owed as petroleum profit taxes, $1.089 billion as company income taxes and $201.69 million as education tax. Others include $18.46Million and £972,000 as Value Added Tax, $23.91 million and £997,000 as Withholding Tax, $4.357 billion as royalty oil, $292.44 million as royalty gas, while $270.187 million and $41.86 million were unremitted gas flare penalties and concession rentals respectively”, Dr. Orji added
Speaking on what the N2.6trn could do for the economy, he said it could have covered the entire capital budget of the Federal Government in 2020 or even used to service the federal government’s debt of $2.68billion in 2020.
“In 2021, the 2.659 trillion could fund about 46 percent of Nigeria’s 2021 budget deficit of N5.6 trillion, and is even higher than the entire projected oil revenue for 2021. This is why it is important that the process of recovering this humongous sum be set on course to support government in this period of dwindling revenue”, he noted.
Earlier, the Chairman of the National Stakeholders Working Group (board) of NEITI, Mr. Olusegun Adekunle expressed the determination of the new board to ensure that the nation derives the best benefits from the extractive sector.
“This NSWG is determined to leave a deepened legacy of achievements during its tenure and shall be strong on unity of purpose and engagement.
“Particularly, the NSWG shall sustain the transparency embedded in the procurement processes, development of a board manual, activation and strengthening of the of the Remediation Task Teams, observance of strict code of conduct, compliance with government rules and regulations, training and retraining of board members on the EITI processes and standard; staff welfare and human capital development, review of the NEITI Act and development of a self assessment system for board members and the Secretariat to be carried out at the end of each year; as well as the initiation of a multi donor basket strategy to improve funding”.