A report by the Office of the Auditor General for the Federation (OAuGF) has exposed significant financial infractions of up to ₦75.5 billion in the revenue and economic sector, particularly the Federal Inland Service, (FIRS).
The annual report was to check non-compliance and internal control weaknesses in federal ministries, departments and agencies (MDAs) in 2021.
The infractions included unrecovered taxes, unapproved payments, and overpayments, with notable cases in the South-East, South-South, Northern region, FIRS headquarters, as well as several tax offices within the nation’s capital.
The audit showed that the FIRS headquarters in Abuja recorded a payment of ₦646.97 million for ICT equipment without approval from the National Information Technology Development Agency, (NITDA), as provided for by the establishment circular. Also made, was an overpayment of reward for outstanding service of more than ₦7.2 million, contravening the FIRS human resource policy. These amounts totalled about ₦654.1 million.
The audit said the infractions could be attributed to weaknesses in the internal control system of the agency, recommending strict sanctions accordingly.
The Auditor-General’s report found anomalies by FIRS offices in various states in the North amounting to about ₦1.27 billion. The report unrecovered tax arrears by the government business tax office in Lafia amounting to ₦473.69 million, as well as ₦72.78m unrecovered by the micro and small tax office.
The findings further revealed that Bauchi MSTO failed to recover about ₦43.7 million in tax liabilities. The State’s business tax office also failed to recover ₦699.1 million in outstanding debts. The Damaturu government business tax office defaulted to the tune of ₦16.1 million.
The findings also showed that regional offices in Akwa-Ibom, Cross River and Bayelsa States gulped ₦26.3 billion in unrecovered taxes, as well as ₦14.72 million, being the penalty for late returns. These States had unrecovered debts traced to their tax offices reaching up to ₦418,37 million, which climbed to ₦26.7 billion.
The report also stated that FIRS tax offices in the nation’s capital failed to follow financial regulations, leading to infractions of ₦43.1 billion as of the end of 2021. According to details from the OAuGF’s finding, 16 issues were found across various tax offices.
The report further showed that the government business tax office in Abuja had not recovered ₦6.1 billion owed by 168 companies, $2.8 million which was ₦4.51 billion (based on the exchange rate as at the time of putting this report together) owed by 2 companies as VAT and withholding tax. Also €41,363, which was ₦70.27 million, was owed by a company as withholding tax as of 31st December 2021.
The OAuGF’s report recommended that the FIRS Executive Chairman should be requested to appear before the Public Accounts Committees of the 10th National Assembly regarding the infractions, as they violate financial regulations.
The report also urged the agency to recover and remit all outstanding taxes to the Treasury’s or face appropriate sanctions.
