The Executive Chairman,
Lagos State Board of Internal Revenue (LIRS), Mr Babatunde Fowler, has alleged that Nigerian employers are deliberately shielding their expatriate employees from paying tax.
He made the allegation at a seminar organised by the Nigerian-South African Chamber of Commerce in Lagos.
Fowler, speaking on: “Issues and Challenges of Taxing Expatriates”, said that non- remittance and under-taxing of expatriates by the employers were major challenges facing LIRS.
“All foreigners working in the country are taxable under the Personal Income Tax Amendment (PITA), 2011.
“Employers often deliberately under-taxed their foreign employees’ income through the design and implementation of various schemes aimed at tax evasion.
“Non-disclosure of offshore income arising from the Nigerian employment as well as willful non-disclosure of employees’ allowances and other prerequisites such as utility bills paid on behalf of the expatriates are major issues.”
Fowler said that employers of labour had major contributions towards assisting the state government to ensure the success of PITA.
“Employers’ duty to deduct taxes from their employees’ income is imposed by Section 81 of PITA.
“It is the duty of employer of a foreign national who holds a Nigerian employment to deduct appropriate taxes from such employee’s income and remit same to relevant tax authority in Nigeria.
“They should desist from disclosing unrealistic income for the expatriate’s employees which often leads to tax authority’s re-evaluation of these disclosures.
“Abuse of court processes by obtaining orders restraining enforcement of taxes on expatriates by employers is totally unacceptable, “ he said.
Mr Solomon Leggjack, the Deputy Comptroller/Special Assistant to the Comptroller-General of Immigration, said that some expatriates were having immigration challenges as a result of the negligence by their employers.
“Lack of knowledge of the immigration requirements before employing expatriates is a major problem.
“Some expatriates arrive with non-vetted credentials and travel documents, while some arrive without credentials and requisite qualifications for the positions they intend to occupy,” he said.
Leggjack said that the Federal Government had adopted measures to create a friendly environment for the expatriates through improved immigration services.
“Government has authorised the issuance of visa- on-arrival/point of entry as part of the new visa policy for certain categories of foreigners and high net worth investors.
“Nigerian Immigration has commenced a massive re-orientation of its personnel as well restructuring of its operational mode away from practises disincentive to foreigners coming into the country.”