Nigeria is set to launch the Voluntary Asset and Income Declaration Scheme, VAIDS on June 29, 2017.
The scheme will outline the plans by Government to increase tax awareness and compliance, and grant tax payers a time-limited opportunity to regularise their tax status without penalty.
The plan will be executed jointly by Federal and State Governments, it would concentrate on the national duty of all Nigerian companies and citizens to pay their taxes, wherever their income is earned, wherever they reside and no matter how rich they are.
The Deputy Director of information, in the ministry of finance, Mrs. Patricia Deworitshe, said that the plan provides a one-off opportunity for evaders to avoid the full force of the law between July 1 and 31 December 2017.
Regularising tax status
During this period evaders can regularise their tax status in exchange for immunity from prosecution of tax offences and a tax audit, and be free from penalty charges and interest.
Evaders who delay participation beyond 31 December 2017 will be liable for interest on overdue tax balances.
The scheme also provides for install-mental payment as Expert, international asset tracers and investigative specialists have been appointed to assist the Government in tracing assets held by Nigerians.
Deworitshe said Nigeria has signed some International agreements, effective from 2018,that will enable easier access to information across the world.
Agreements with nations
Nigeria has signed agreements with a number of nations (US, UK, Canada, UAE, Switzerland, Mauritius, Panama and Bahamas) all of whom have pledged support and cooperation to exchange information on citizens that is relevant for tax purposes.
Under the new scheme, all tax evaders, when identified are subject to the full force of Nigerian and international law, imprisonment of up to five years, Severe extra penalties up to 100% of the outstanding tax due, compound interest at 21% per annum, forfeiture of assets.
The Minister of Finance, Mrs. Kemi Adeosun said similar schemes in 2016 have been implemented successfully in India, Indonesia and South Africa.
VAIDS will bring Nigeria in line with international best practice and contribute to worldwide efforts to tackle corruption.
The Minister Stated that the much needed funds will be generated and transparently invested.
Anticipated funds to be raised are at least US$1 billion, which will reduce Nigeria’s borrowing needs, allow investment in vital infrastructure and spur development.
“During the last eight years, Nigeria has failed to reduce its debt levels despite high oil prices and nominal GDP growth. We have inherited a situation where our debt and underdevelopment is getting worse not better. This cannot continue.
“Neither can the behaviour of some of our richest citizens and multinationals operating in Nigeria, who seem to consider paying tax to be optional. From 2018, international law will make it easier than ever to track these evaders down and punish them.
“This scheme is in line with similar initiatives launched during 2016 in India, Indonesia and South Africa. We know they work, we know it’s the right thing to do and the Treasury desperately needs the money.
“Finally, the proceeds of this scheme will not disappear. We will provide regular updates on the funds collected to date, and how those funds are being put to very transparent use.” The Minister explained.