By Linus Aleke, Abuja
The House of Representatives, yesterday moved to put an end to the abuse of tax incentives and waivers, by local and foreign business enterprises in Nigeria.
The Speaker of the House of Representatives, Tajudeen Abbas, said the abuse of tax incentives and waivers was an act of economic sabotage that must not be allowed to continue.
Abbas said this while inaugurating the Ad-hoc Committee to investigate allegations of abuse of tax incentives, tax breaks, and tax waivers by public institutions and companies benefitting from tax incentives.
Represented by the House Leader, Prof Julius Ihonvbere, the Speaker said the investigation by the House was to put an end to such acts of economic sabotage and ensure transparency, accountability, and fairness in our tax system.
He noted that tax incentives are an essential tool used by governments to promote economic growth, attract investments, and stimulate job creation.
He further noted that it is crucial to ensure that these incentives offered by the government are utilised appropriately and not being misused or abused.
According to the Speaker, “The allegations that have been brought to the attention of the House suggest that some public institutions and companies may be taking advantage of these incentives for personal gain or to evade their tax obligations. Hence the establishment of this committee.
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“In carrying out this investigation, the Committee is required to thoroughly investigate these allegations and provide recommendations for necessary sanctions and reforms. Endeavour to find out whether the beneficiaries of these tax incentives have lived up to the conditions attached to them and if they have fulfilled their obligations to the Nigerian people as required”.
Abbas further said, “Your mandate will be to examine the extent of the alleged abuse by public institutions and organisations, review relevant legislation, policies, and regulations governing these incentives to identify any loopholes or weaknesses that may have contributed to the alleged abuse.
“The purpose of this investigation is to end all forms of economic sabotage and ensure transparency, accountability, and fairness in our tax system. I, therefore, call on all relevant stakeholders, including government agencies, public institutions, and companies benefitting from tax incentives, to cooperate fully with the committee’s investigation for the House to have a full understanding of the tax system to take appropriate legislative actions.”
The Chairman of the Ad-hoc Committee, Abubakar Yalleman, said taxes enable the government to raise the necessary funds needed for development.
He said, “Abuses of tax incentives by the supposed beneficiaries and the statutory institutions meant to regulate the tax regime could push the government into fiscal constraints. While tax incentives are granted to encourage businesses to stand well and be strong enough to contribute to the economy, their abuse creates distortions in fiscal and monetary policy management.
“As Nigeria experiences dwindling oil revenue and public debt approaches prohibitive levels amidst allegations of abuse of tax incentives, there is the need to know the scope of tax incentives and the possible existence of abuses to enable proper administration of the tax breaks, waivers, and incentives”.
The Chairman observed that where taxes are inadequate, where there are leakages, or where infractions of the system lead to narrowing of tax inflow, the government resorts to borrowings which have attendant consequences for national development.
