Members of the House of Representatives have unveiled plans to review the nation’s tax laws, with the intent of eliminating tax holidays to multinationals, especially in the areas of telecoms, maritime, power, oil and gas.
Kehinde Odeneye, (APC-Ogun), who dropped the hint during an interactive session with civil society organizations (CSOs) and other stakeholders at the National Assembly complex, Abuja, on yesterday, demanded for an audit of all the tax incentives enjoyed by both foreign and local companies over time.
Participants at the meeting, however decried the huge amount lost to indiscriminate waivers granted to the multinationals and urged the Federal Government to discontinue the granting of tax incentives and holidays to them, stressing that such gesture was detrimental to the economic growth of the country.
According to him; “In addition we are going to really take on the challenge by Action Aid to investigate the roles of agencies and individuals involved because cases of manipulations and conspiracy have been established.
“Looking at our tax laws, there are so many loopholes that have been manipulated which makes it expedient to be amended for a good tax environment.
“The time is now to review it, and it is going to be holistic cutting across all sectors, telecommunications, oil and gas, maritime, power, no sector would be excluded in the audit and review.”
In his remarks, Mitchel Lecomte, Consultant to European Commission (EC) noted that the aims of encouraging Foreign Direct Investments (FDI) into developing countries had been defeated with the quantum of funds involved.
On his part, Tunde Aremu, Manager, Action Aid’s Policy Advocacy and Campaigns, disclosed that three multinational companies involved with the Nigerian Liquefied Gas (NLG) enjoyed tax holiday amounting to $3.9 billion.
Aremu argued that tax holidays remains a deliberate means of throwing away the nation’s financial resources by a Government that is not dire need of funds to fix it’s decaying infrastructures and economy.
He described tax incentives enjoyed over the years by multinationals operating in the country as theft because the incentives were not only unnecessary but also manipulated.
“How are these incentives negotiated because some of our suspicion is that the processes of negotiating these incentives are not open. The companies go under the rugs to negotiate these incentives “The Nigerian parliament should start querying the processes and demand that they should be open and transparent. And that the representatives of the people should be informed when these incentives are being negotiated in order to have a say if they are necessary or not?
He described e-trading, over invoicing, mispricing and price shifting as some of the technical terms adopted by the companies to encourage illicit financial flow from the country adding that although, tax avoidances were legal “but they are actually legal means of stealing money.”
“The bulk of the money leaving Africa that we are losing contrary to impression is not due to corruption, crime, drug trade or trade in human trafficking or other crimes.
“Over 75 percent of the money leaving Africa illicitly is actually through tax avoidance practices which unfortunately are not regarded as illegal,” Aremu said.