Nigeria lost N5.4tn to tax evasion by multinationals – FIRS chairman

Nigeria lost over $178 billion (about N5.4 trillion) through tax evasion by multinationals operating in the country between 2007 and 2017, Executive Chairman, Federal Inland Revenue Service (FIRS), Mr Muhammad Nami, has said.

He stated this on Monday at a workshop on effective audit of multinational corporations for domestic revenue mobilisation in Nigeria, which was organised by the service in partnership with the Tax Justice Network.

A statement by the Director, Communications and Liaison Department at the FIRS, Dr Abdullahi Ahmad, quoted Nami as also saying with the signing of the 2021 budget of N13.58 trillion by President Muhammadu Buhari and given the recent decline in oil resources, the major revenue earner for the country, taxation, was expected to continue to shoulder the government’s budget performance the way it did in 2020.

He also said the service had created 35 additional tax audit units over the last one year to stem illicit financial outflows as well as improve tax compliance rate among corporations.

He said many “rich multinational corporations do not pay the right taxes due from them, let alone pay their taxes voluntarily.”

He, however, stated that some of the companies were “leading in tax compliance in various sectors.”

The FIRS boss cited a 2014 report by the High-Level Panel on Illicit Financial Flows from Africa, saying, “Nigeria accounted for 30.5 per cent of money lost by the continent through illicit financial flows.”

Nami also said, “At the FIRS, we are paying greater attention to tax audit in general and transfer pricing audit in particular in order to improve the level of tax compliance in the country.

“As a result, in the last one year, we have created more than 35 additional tax audit units and deployed experienced and capable staff to take charge of these offices.”