By Levinus Nwabughiogu

ABUJA-In a country of about 180 million people, only 214 individuals pay in excess of N20m the Federal government lamented on Thursday.

It also regretted that many multinational companies evaded tax payments.

The government also expressed concerned over the growing rate and the effects of deforestation in the country even as it received briefings on the current security situation.

Revealing that Nigeria has the lowest non-oil tax to GDP at 6%, the government has however enacted a new tax policy which it hoped would block all the loopholes and generate at least $1 billion to government.

The new tax scheme which was approved by the National Executive Council, NEC, at its meeting held at the Presidential Villa and presided over by Vice President Yemi Osinbajo on Thursday was sequel to a presentation made by the Minister of Finance, Mrs. Kemi Adeosun.

Briefing State House correspondents at the end of the meeting, the Chairman, Federal Inland Revenue Services, FIRS, Mr. Babatunde Fowler who was joined by Governor of Abia State, Okezie Ikpeazu and the Deputy Governor of Kaduna State, Bala Bantex said that the new tax regime subsumed under Nigeria Voluntary Asset and Income Declaration Scheme (VAIDS) would commence May 1.

He said: “Under payment of tax via the use of Tax Havens and other evasion strategies has not been helpful to Nigeria. This practice has been principally perpetrated by multinational companies and high net worth individuals. Nigeria has the lowest non-oil tax to GDP at 6%

“The proposed Nigeria Voluntary Asset and Income Declaration Scheme (VAIDS) will capitalise on the considerable international goodwill built by President Buhari in his mission to rebuild Nigeria.

“Capitalise also on the current global movement against tax evasion and illicit financial flows.

“It will offer a window for those who have not complied with extant tax regulations to remedy their position by the provision of limited amnesty to enable voluntary declaration and payment of liabilities.

“VAIDS scheme targets to increase the tax to GDP ratios to 15% from just 6% by 2020. VAIDS scheme will simultaneously generate revenue and encourage investment and economic activity – as only 214 individuals in the entire country pay N20 million or more in tax annually

“VAIDS scheme will embrace all Federal and States’ taxes such as Companies Income Tax, Personal Income Tax, Petroleum Profits Tax, Capital Gains Tax, Stamp Duties, Tertiary Education Tax, Technology Tax.

“The scheme is intended to cover all back taxes without any limit to time on how far back a tax assessment can go where a taxpayer has willfully defaulted.

“The scheme is targeted to run from May 1, 2017 for up to 6 months and incentives will be put in place to encourage early participation
Tax payers will be allowed up to 3 years to settle their liabilities.
Revenue expected from the scheme conservatively estimated at US$1 billion.”

He added that the State governments would participate in the implementation of the scheme.

Fowler also stated that the current balance of the Excess Crude Account stood at $2,45,864 as at March 15, 2017.

He said: “Based on initial estimates, it is anticipated that at least 50% of the funds recovered will belong to States who are the ultimate collectors of personal income taxes.
MoU to be gazetted and will be signed with each State Government.

“The Honourable Minister of Finance reported to Council that the balance in the Excess Crude Account (ECA) as at 15th March, 2017 stood at US$2,45,864,724.59, recording a marginal increase of US$2,458,382,882.03

“Finance Minister added that the ECA balance does not reflect the decision of Council last month to deduct S250 million for injection into the Sovereign Wealth Fund.

“The Stabilization Fund Account (SFA) is an account equivalent to 0.5% of the Federation Account allocated and paid into a fund to be designated (Stabilization Account) from where if any State of the Federation suffers absolute decline in its revenue arising from factors outside its control, shall tap in, to augment the allocation to that State.

“Based on the above, the Hon. Minister of Finance informed Council that the Revenue Mobilization Allocation and Fiscal Commission (RMAFC) recently approved for disbursement (N39,613,282,870.69) to a number of States.

“The Honourable Minister further informed Council that the balance in the SF now stands at N25,793,400,290.00”.

Also speaking, the Abia State governor, Ikpeazu said that NEC expressed concerns over the devastating effects of deforestation in the country.

He said: “Various stakeholders have broadly acknowledged the alarming rate of deforestation and its causes across the Nigeria landscape
Major drivers of deforestation remain unsustainable agricultural practices, over exploitation of forest (for external and domestic trade), infrastructural development among others.

“Deforestation has progressed at about 3.5% of the total forest area level in the last decade – which translates to about 350,000 hectares of forest loss and requiring at least 420 million tree seedlings per annum to pant over-run deforestation.”

He also highlighted the efforts made so far to tackle the menace.

“July 2016 National Council on Environment (NCE) held in Lafia, Nasarawa State resolved to encourage States to promote forestry development and aforestation programmes and to also promote the use of alternative sources of energy
Temporary lifting of the suspension on wood export and issuance of convention of International Trade in Endangered Species of Wood Faora & Flora (CITES) permit.

“Ministry of Environment set about strengthening processes that would enable legitimate business to obtain CITES permit.

“Recommendations among others Need to accelerate and review the extant National Forest Policy as well as ensure its backing through the enactment of relevant Forest Laws.
Massive Afforestation/Reforestation of degraded forest and landscape outside Forests.

“Establishment of take-off of the National Forestry Trust Fund through contributions by Wood Products Exporters according to products classification (tally processed, semi processed, charcoal) etc.

“Establishment of National Forest Model Estate in all the States and FCT.

Improvement in forest governance and establishment of National Taskforce to effectively protect the forest Estate/Reserve.

“Effective monitoring, evaluation, documentation of trade in wood and wood product”, he said.

On his part, the Deputy Governor of Kaduna State, Bantex said that NEC was briefed on the security situation of the country by the National Security Adviser, NSA, Babagana Monguno who noted that unemployment was a major threat to security.

“The NSA briefed the Council on the Security situation in the country with particular reference to: Boko Haram insurgency in the North-East Cattle rustling; Ethnic militias/security outfits; Kidnapping, Armed robbery; Militancy in Niger Delta; Proliferation of small arms across the country

“The NSA fingered unemployment as the major threat to security.

In their responses, Council members highlighted the potential role and significance of the Federal Government’s Social Investment Programmes in averting some of the threats and encouraged an active implementation going forward. Council agreed to hold an extra-ordinary session to discuss security matters especially as it has to do with the economy”, he stressed.