Economy
FIRS Generates N3.5tr in 8 months, to Freeze Accounts of 6,772 Billionaires
By Modupe Gbadeyanka
Not less than N3.5 trillion has been generated as revenue from taxes from January 2018 to August 2018, Executive Chairman of Federal Inland Revenue Service (FIRS), Mr Tunde Fowler, has disclosed.
A stakeholders’ meeting in Lagos, the taxman said this was N1 trillion more than what was realized throughout 2017.
“If you look at 2018 revenue to date, between January and August, we have done N3.5 trillion, which is N1 trillion over 2017.
“But the main point I want to make is that majority of taxpayers that accounted for this revenue have not changed. The laws have not changed. And to a great extent, the consultants to these companies have not changed. If you look at 2017, there is an increase of close to N800 billion over the 2016 collection.
“The increase in 2018 so far showed N1 trillion. If the same consultants advised or reviewed the accounts of the majority of the taxpayers, one would wonder why such large increases occurred. It is either the taxpayers did not disclose fully their finances to the consultants or the consultants involved in tax planning,” Mr Fowler said.
Also at the stakeholders’ meeting attended by representatives of the Central Bank of Nigeria (CBN), professional accounting and audit firms, tax consultants, Nigerian Bar Association (NBA), Manufacturers Association of Nigeria (MAN), and others, the tax chief disclosed that his agency would soon go after the bank accounts of defaulting taxpayers who are raking in billions of Naira in Nigeria and are not paying taxes.
According to him, over 6772 defaulting billionaire taxpayers have been identified by the FIRS through banks data.
He said most of such taxpayers, who have between N1 and N5 billion in their accounts have no Taxpayer Identification Number (TIN) or have TIN and have not filed any tax returns as taxpayers.
“What we have done is what we call ‘substitution’ which also is in our laws which empowers us to appoint the banks as collection agents for tax.
“So, all these ones of TIN and no pay and no TIN and no pay, to the total of 6772 will have their accounts frozen or put under substitution pending when they come forward.
“First, they refused to come forward in 2016, they refused to come forward under VAT and are still operating here. So, we are putting them under notice that it is their civic responsibility to pay tax and to file returns on these accounts.
“We looked at all businesses, partnerships, corporate accounts that have a minimum turnover of N1 billion per annum for the past three years. First of all, the law states clearly that before you open a corporate account, part of the opening documentation is the tax I.D.
“From the 23 banks we have analysed so far, we have 31,395 records, out of which effectively minus duplications we had 18,602.
“We broke those into three categories: Those that have TIN tax I.D, those that don’t have no TIN and of course no TIN no pay and those that have TIN and have not even paid anything.
“So, on a minimum, every company or business included here over the last three years have had a banking turnover of N3 billion and above. Some of them have had banking turnover of over N5 billion and have not paid one kobo in taxes. Now the total number of TIN and no pay is 6772.
“So, if someone is good in mathematics and you take the minimum level of N3 billion multiply by 409 and they are operating within our society and economy and do not remit or make any tax payment,” he said.
Mr Fowler urged banks “to support us [because] in supporting us, you are supporting Nigeria. In supporting Nigeria, you are supporting all Nigerians and those who have chosen Nigeria as home. And most of all, you are supporting a future that we can leave behind for the upcoming youth of Nigeria.
“I remember this when we were growing up a statement made by Wole Soyinka that our generation is a wasted generation. That (statement) has remained in my mind for many years. Wole Soyinka is still alive. His generation is a generation of 80s and above. Let us not look back and say also our generation has not left any value behind. I think it is time for us to change.”
He appealed to Nigerians to continue to support the government by paying their taxes because “gone are the times or days we ask what has government done for me. We should ask what we are doing for ourselves and the nation first. We should obey the law, pay our taxes, empower our governments at various levels, then sit back and see the end results.
“If we see the amount of the budget that has gone into capital under this present government, but not only gone into the government but being expensed, it is at least three times more when the revenues were even higher.”
By Adedapo Adesanya
Dangote Petroleum Refinery is preparing to raise about $5 billion through an initial public offering (IPO) expected to conclude in October, in what could become the largest stock market listing in Africa’s history.
The company has already submitted an initial application to the Securities and Exchange Commission (SEC), with approval expected in the coming weeks. Once authorised, the refinery is expected to release its prospectus in September ahead of the public offer.
The primary listing will be on the Nigerian Exchange (NGX) Limited, although investors across Africa are expected to participate through structured investment instruments rather than a dual listing.
The proceeds will be used to expand the capacity of the 700,000-barrels-per-day refinery in Lagos and possibly support plans to replicate the project in Kenya as Dangote seeks to deepen Africa’s energy independence.
The proposed IPO comes after the refinery benefited from increased demand for refined products during the recent Iran conflict, supplying jet fuel across Africa and into Western Europe as global shortages disrupted markets.
As per Reuters, stock exchanges in South Africa, Kenya, Egypt, Ghana and Rwanda have held discussions with advisers to the transaction as interest in the offering continues to build across the continent.
Kenya alone could account for as much as $500 million of the targeted capital raise, driven largely by demand from institutional investors, including pension funds, the publication reported.
While the company is targeting a $5 billion raise, the final amount will depend on the outcome of the SEC’s review. If achieved, the offering would represent more than four per cent of the Nigerian Exchange’s current market capitalisation.
The IPO follows a $2.5 billion private placement completed last month, in which a six per cent stake in the refinery was sold, implying a valuation of about $40 billion.
That valuation, however, would place the refinery well above several listed global refining companies. Turkey’s Tupras, which operates a similar combined refining capacity across four facilities, has a market value of roughly $12 billion, while US-listed HF Sinclair, with a comparable processing capacity, is valued at around $16 billion.
Although the NGX generally requires companies on its main board to maintain a minimum free float of 20 per cent, there have been exceptions. Dangote Cement, for instance, currently has a free float of just over 12 per cent.
The publication also reported that investors outside Nigeria are likely to gain exposure through instruments such as global depositary receipts or exchange-traded products linked to the Nigerian-listed shares, rather than through a cross-listing on other African exchanges.
The founder of the 700,000-barrels-per-day capacity plant, Mr Aliko Dangote, said in April that the refinery aims to increase production capacity to 1.4 million barrels per day.
Mr Dangote is also pursuing plans to build another refinery in Lamu along Kenya’s coast in partnership with other East African governments, although it remains unclear whether part of the IPO proceeds will be allocated to that project valued at an estimated $17 billion.
By Adedapo Adesanya
The NASD Over-the-Counter (OTC) Securities Exchange rallied by 0.89 per cent on Tuesday, August 4 amid renewed buying interest in unlisted stocks.
During the session, the market capitalisation added N24.07 billion to end at N2.739 trillion compared with Tuesday’s N2.715 trillion, while the NASD Security Index (NSI) gained 40.11 points to quote at 4,563.96 points compared with the preceding day’s 4,523.85 points.
The NASD OTC Exchange ended the trading session with two price losers and three gainers, led by Central Securities Clearing System (CSCS) Plc, which chalked up N7.80 to close at N119.80 per unit versus the previous session’s N112.00 per unit. Afriland Properties Plc increased its value by N1.27 to N23.95 per share from N22.68 per share, and Nitrox Industrial Gases Plc expanded by N1.15 to N21.15 per unit from N20.00 per unit.
On the flip side, FrieslandCampina Wamco Nigeria Plc slid by N8.64 to sell at N144.00 per share compared with the previous day’s N152.64 per share, and 11 Plc dipped by 1 Kobo to end at N225.00 per unit, in contrast to Monday’s closing price of N225.01 per unit.
Tuesday’s trading data showed that the volume of securities rose by 9.0 per cent to 1.6 million units from 1.5 million units, and the number of deals climbed by 6.5 per cent to 33 deals from 31 deals, while the value of securities dropped by 26.9 per cent to N47.6 million from N65.2 million.
At the close of trades, Great Nigeria Insurance (GNI) Plc remained the most traded stock by value on a year-to-date with 3.4 billion units worth N8.4 billion, followed by Infrastructure Credit Guarantee (Infracredit) Plc with 2.3 billion units valued at N6.5 billion, and CSCS Plc with 76.9 million units exchanged for N5.5 billion.
GNI Plc also closed the session as the most traded stock by volume on a year-to-date with 3.4 billion units transacted for N8.4 billion, followed by Infracredit Plc with 2.3 billion units sold for N6.5 billion, and Resourcery Plc with 1.1 billion units transacted for N415.7 million.
By Dipo Olowookere
A 0.38 per cent loss was suffered by Nigerian stocks on Tuesday on the back of continued selling pressure from investors embarking on profit-taking.
Data from the Nigerian Exchange (NGX) Limited showed that the contraction was influenced by the 1.78 per cent decline recorded by the insurance sector, the 0.24 per cent slip printed by the consumer goods index, and the 0.09 per cent drop posted by the energy space, offsetting the 0.75 per cent growth achieved by the banking sector and the 0.21 per cent growth recorded by the industrial goods segment.
Investor sentiment was weak during the trading day, as the bourse ended with 13 price gainers and 40 price losers, representing a negative market breadth index.
LivingTrust Mortgage depreciated by 10.00 per cent to N3.42, Multiverse also shed 10.00 per cent to N22.95, McNichols dropped 9.92 per cent to N5.45, Thomas Wyatt dipped by 9.87 per cent to N3.56, and Eterna lost 8.57 per cent to trade at N33.00.
On the flip side, AVA Capital improved by 9.94 per cent to N9.95, Livestock Feeds expanded by 9.71 per cent to N8.65, Neimeth increased by 8.43 per cent to N9.00, AIICO gained 3.47 per cent to settle at N4.18, and Oando grew by 3.30 per cent to N36.00.
A total of 1.6 billion equities valued at N28.7 billion exchanged hands in 54,160 deals yesterday versus the 923.0 million equities worth N37.9 billion traded in 72,544 deals on Monday, indicating a 73.35 per cent surge in the trading volume, a 24.27 per cent decline in the trading value, and a 25.34 per cent slip in the number of deals.
The busiest stock was Japaul, which transacted 904.4 million units for N2.7 billion. Sterling Holdings sold 54.0 million units valued at N431.9 million, FCMB exchanged 49.5 million units worth N545.9 million, Chams traded 44.9 million units for N199.2 million, and Neimeth sold 42.4 million units worth N327.8 million.
Business Post reports that the All-Share Index (ASI) gave up 927.70 points to 244,802.83 points from 245,730.53 points, and the market capitalisation receded by N599 billion to N158.016 trillion from N158.615 trillion.
