Nigeria to impose taxes on Nigerians who own assets abroad

Nigeria to impose taxes on Nigerians who own assets abroad

UBA personal banking

The Federal Government of Nigeria has begun a process of compelling Nigerians with assets overseas to pay taxes on them in a bid to increase the Internally Generated Revenue (IGR) and lift the nation’s economy out of economic recession.

This is contained in the new tax policy that is being worked out by the National Tax Policy Review Committee (NTPRC).

The Chairman of the Committee, Prof. Abiola Sanni, who disclosed this during an interview with our reporter in Abuja on the content of the new tax policy explained that” There are people who have assets abroad that are not being accounted for.”

Consequently, the new tax policy would ensure that the Federal Government collects taxes on these assets as it is being done by advanced economies of the world.

The Chairman, while citing America as an example said “If an American has an asset above $50,000 anywhere in the world, there is a requirement that the institution where that money is warehoused should report.

“That is a nation that is strong, efficient and determine to go after its citizens and go after their assets and ensure that the tax due on them are paid.”

He explained further: “What does it mean to expand the tax net? You bring in those who are outside the net. If your citizens have their incomes stashed in Switzerland you must find a way to reach it,” he pointed out.

Nigerians have tens of trillions of dollars both in cash and assets in foreign banks with some of the most expensive houses and in large scale abroad.

Unofficial records say assets not declared to Nigerian government stood at a staggering $27 trillion while cash in various banks abroad is about $6.7 trillion.

Remittances to Nigeria by her citizens have unofficially dropped to $25 million dollars. With Nigerians being very active economically overseas, tax experts say billions of naira can accrue to government if the right measures such as sound diplomacy is adopted.”

According to a tax expert in the UK, Mr Bello Lucas, Nigeria is among the top ten countries in the world with the biggest assets and cash overseas.

“Nigeria is number one in Africa when you consider countries with largest assets and cash abroad,” he said. He added that, “She is among the top ten in the world.

“Why Nigeria’s case is worse and perhaps shocking is that no one pays taxes on this huge wealth abroad so that Nigeria can benefit from them. On the contrary, taxes are paid to countries housing these cash and assets.

“And 70% of these assets and cash were stolen by politicians, who for want of escaping the government and beat the poor system, stash them abroad.

“The UK, The US, Switzerland are among the safe haven where these huge wealth are housed,” he pointed out.

Putting the figures, which he said were still being worked on, Mr Lucas said, “cash and assets belonging to Nigerians are about $33.7 trillion. And when you count those that the owners no longer have access to or have died then, you weep for the country,” he said in telephone chats.

According to Mr Sanni, the tax net would be expanded to accommodate this huge wealth overseas to lift the economy. “You don’t expand the tax net by focusing only on those who are already complying. You are going to kill the few tax compliant if you continue to do that.”

He pointed out that the government would collaborate with foreign governments where these things are stashed to get empirical data through bilateral agreements to enable taxes be exerted on them.

“In international taxation, there is what is called allocation of taxing right,” he explained the process, how foreign countries collaborate to tax cash and assets domiciled in their respective countries.

He decried the poor showing in this regards from Nigeria saying, “Nigeria is not playing actively in seeking to bring tax asset into its net from other nations.

For example, all the stolen wealth, they are being taxed in the various accounts where they are domiciled abroad but the tax law here says if you live here and you have income from anywhere in the world, you must pay tax on it.

“So, at the end of the day, I agree that double taxation may kick- in but there are ways nations resolve double taxation through agreement. So, we need to expand our taxing network to where our citizens have assets,” he added.

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