Home NIGERIA BREAKING: Nigeria senate investigates deposit banks over remittance of tax revenues

BREAKING: Nigeria senate investigates deposit banks over remittance of tax revenues Updated for 2021

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Updated: February 25, 2021

The Nigerian Senate has mandated its Committees on Banking, Insurance and Financial Institutions, and Finance to investigate withholding tax revenues on both bank deposits and dividends.

This was even as it urged banks and Central Security and Clearing System (CSCS) to work with various government agencies and stakeholders in ensuring that collection and remittance of withholding tax to the Federal Government are done using modern automated tax solutions and information technology solutions.

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These were resolutions reached on Tuesday by the upper chamber during plenary, and after consideration of a motion sponsored by Uche Ekwunife (PDP – Anambra Central).

Ekwunife, in her presentation, disclosed that “Central Security and Clearing System (CSCS) and Banks in Nigeria do not remit Withholding Tax on Deposit and Dividend to State Governments as and when due.”

According to the lawmaker, most State Government are unable to pay salaries and meet their financial obligations as a result of poor and dwindling revenue.

She raised concerns that “billions of Naira are being held by banks in Nigeria either in form of under remittance or non-remittance  of Withholding Tax due to government.”

Ekwunife added, “The need for states to increase their Internally Generated Revenue has become imperative given the dwindling revenue from the federation account which has left various State Governments in Nigeria with the task of formulating strategies to improve the revenue base of their states.”

The lawmaker further expressed concern that one of the major sources of revenue for state governments is the Withholding Tax on bank deposits and dividends which has been difficult for States to track.

She stated that “the current practice is that both the banks and Central Security Clearing System remit to state governments any amount they desire as it is difficult for the states to reconcile what amounts should be credited to them.”

Ekwunife, however, opined that the leakages with respect to remittance of Withholding Tax can be addressed using modern tax solutions and information technology.

Meanwhile, the Senate also on Tuesday urged the Nigeria Police Force, the Federal Road Safety Commission and Vehicle Inspection Officers to immediately clamp down on truck and lorries plying federal highways without the minimum prescribed levels of lighting or road safety requirements.

The resolution was reached sequel to the consideration of a motion sponsored by Senator Teslim Folarin (APC – Oyo Central).

According to the lawmaker, in 2017, there were 779 recorded Road Traffic Collisions involving trailers and tankers, which resulted in 737 fatalities and 2,622 serious injuries.

He added, “In 2018, over one thousand lives and an estimated N39 billion were lost directly due to accidents involving trucks and articulated lorries.”

The Chamber, accordingly, mandated its Committee on Federal Character and Inter-Governmental Affairs to investigate the level of compliance to road safety legislations among haulage operators, owners and drivers, as well as the implementation of the recommendations from the 2018 haulage Operators Stakeholders’ summit.

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