Tuesday, January 19, 2016

SEE : How Nigeria Lost $3.3 To Foreign Oil, Gas Firm

A new report showed that Nigeria has lost as much as $3.3 billion as result of a series of extraordinary tax breaks granted by the Nigerian government to some of the world’s biggest oil and gas companies.
File photo of minister of state for petroleum resource, Dr. Ibe Kachikwu
The tax break which was said to have begun in 1999 had seen
companies like Shell, Total and ENI which form part of the Nigeria Liquified Natural Gas (NLNG) consortium befitting from tax holiday.
The NLNG Act grants ten year tax incentive which exempts the company from all corporate tax payments for the first ten years of operation.
The Nation reported that NLNG ACT makes the consortium the only firm in Nigeria with its own law defining its tax framework and this exempted the consortium from a range of other taxes.

Ojobo Atuluku, the country director of ActionAid Nigeria made this disclosure at the launch of a report “Leaking Revenue: How a big tax break to European gas companies has cost Nigeria billions” in Abuja, Tuesday, January 19.
Atuluku said: “that amount is the equivalent of twice our national education budget and thrice the healthcare budget for 2015.”
“This calls for serious concern in a country where over 20 million children do not go to school and almost 15 out of one hundred children die before their fifth birthday.”
The ActionAid who commences the research from 2013 disclosed that the tax holiday cost developing countries at least $138 billion every year and adding that an estimated $2.9 billion of the amount that Nigeria lost every year as result of tax incentives.
She said: “There is incontrovertible evidence from researches conducted in many developing nations that corporate profits are soaring, and corporate investments in low income countries had tripled since the 1980s. Yet the corporate tax revenues of the countries where these profits are generated have flat-lined as a percentage of their GDP.”

“Women and children suffering as healthcare, schools and other key public services are starved of resources,” while suggesting that if many of these tax incentives are presented, we will be able to improve the lives of women and children with improved availability of health, education and other key public services.
“Nigeria and other resource rich developing countries to begin to review their tax incentive policies and Nigeria National Assembly in particular not only to review existing laws on tax incentives but to exercise caution in the proposed amendment to the Companies Income Tax Act 2004.”