The Speaker of the House of Representatives, Rt. Hon. Tajudeen Abbas, has strongly denounced the abuse of tax incentives and waivers, categorizing them as acts of economic sabotage that must be halted.
The Speaker made these remarks yesterday during the inauguration of the Ad-hoc committee tasked with investigating allegations of tax incentive abuse, tax breaks, and tax waivers by public institutions and companies benefiting from such incentives.
The Speaker, represented by the leader of the House, Julius Ihonvbare, conveyed that the House’s investigation aimed to curtail this economic sabotage and ensure transparency, accountability, and fairness within the tax system.
Tax incentives, he stressed, constitute a vital governmental tool for fostering economic growth, attracting investments, and stimulating job creation.
He further emphasized the need to ensure that these incentives, provided by the government, are appropriately employed and not subject to misuse or exploitation.
He said, “The allegations brought before the House suggest that certain public institutions and companies may be exploiting these incentives for personal gain or to evade their tax obligations”.
He charged the committee, “In carrying out this investigation, the committee is required to thoroughly investigate these allegations and provide recommendations for necessary sanctions and reforms.
“Endeavor 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.
“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 speaker added, “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 with a view of taking appropriate legislative actions.”
Chairman of the Committee, Hon. Abubakar Makki, underscored the pivotal role taxes play in funding developmental initiatives.
He expounded that insufficient tax revenue, leakages, or systemic infractions lead to reduced tax inflow, prompting the government to resort to borrowing, which can have adverse consequences for national 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 contraints.
“While tax incentives are granted to encourage businesses to stand well and be strong enough to contribute to the economy, its 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.”
Makki said the investigation is not a witch-hunting exercise, but a fact-finding mission that aims to correct the abuses in the management of tax incentives and ensure the right thing is done for the general good.