Tax evasion: Reps accuses FIRS Chairman of conniving with oil companies

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The House of Representatives has accused the Federal Inland Revenue Service (FIRS), Muhammad Mamman Nami, of conniving with oil companies operating in Nigeria to evade tax remittances running into trillions of naira.

This was revealed by the Chairman of the House of Representatives Ad-hoc Committee Investigating the Structure and Accountability of the Joint Venture (JV) Businesses and Production Sharing Contracts (PSCs) of the National Petroleum Company Limited (NNPCL), Abubakar Hassan Fulata, at the committee’s sitting on Monday.

Fulata and other members of the committee, who frowned at Nami’s absence despite his invitation to appear before the lawmakers, condemned his impunity.

They maintained that he must appear before the Committee at an adjourned date or risk being compelled to appear by security agents, adding that the probe is in line with the Constitution of the Federal Republic of Nigeria, 1999, as amended.

While responding to questions from the committee, the representative of Chevron Nigeria Ltd, who is a Director at the Company, Monday Ovuede, confirmed that they have no Certificate of Acceptance of Fixed Assets (CAFA) despite enjoying capital allowances over the years.

The Committee noted that Nigeria has been shortchanged in tax payment into the coffers of the Federal Government hence it has been mandated to probe activities of several oil companies from 1990 till date.

Fulata stated that having no Certificate of Acceptance of Fixed Assets indicates gross violation of law in Nigeria, adding that ignorance was not an excuse.

The Committee also noted that Chevron Nigeria Ltd charged Qatar the sum of $1.8 billion for the same project which it charged Nigeria the sum of $10.5 billion, stressing that the company shortchanged Nigeria.

The lawmakers further disclosed that the Qatar project, (Escravos GTL), was completed on time at $1.8 billon but that of Nigeria which they charged at $10.5 took a longer time.

In response, Chevron explained the Nigeria EGTL was initially awarded at $2.9 billon but later reviewed to $10.5 billon to its sub-contractors, adding that the initial completion date was supposed to be in 2009, but it was extended to 2014.

The lawmakers stated “For Chevron on its own to review a project from around $2.9 billion to $10.5 billion to its sub-contractors and expect Nigeria government to pay it in the name of Joint Venture with NNPC is a clear sign of shady deal and sharp practices in the oil and gas industry.”

“Chevron is a USA-based company, but American government will never tolerate that kind of practice where a company in partnership with a government agency will unilaterally review cost of contract.”

Meanwhile, the Committee is expected to probe officials of Total, Shell and other oil companies when they appear on Tuesday.

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