‘NASS Lacks Power to Investigate Firms on Taxation’

30 Apr 2012

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EFCC Chairman, Ibrahim Lamorde

By Crusoe Osagie

The Organised Private Sector (OPS) has declared that the National Assembly lacks constitutional powers to carry out its proposed investigation of corporate tax returns of private companies from 2006 to 2011. It said it has already dragged the NASS to court on the issue.
The OPS comprises the Nigerian Association of Chambers of Commerce and Industry Mines and Agriculture (NACCIMA), Manufacturers Association of Nigeria (MAN), National Association of Small Scale Industrialists (NASSI), Nigerian Employers Consultative Association (NECA), and National Association of Small and Medium Enterprises (NASME).

In a statement signed by all the OPS members and released to THISDAY weekend, the umbrella private sector body argued that an advertorial published by the House of Representatives Committee on Finance on its plan to investigate corporate tax remittance should not compel any company in the private sector to open its doors for any form of audit/ investigation not backed by law.

“Good enough, a motion against this action has already been filed in the Federal High Court and in the interest of civility, orderliness and sustenance of our nascent democracy, we all look forward to the pronouncement of the Court on this landmark case, which we hope will resolve the controversy over the scope of the oversight powers of the National Assembly,” the body said.

According to the OPS, “the House Committee, in discharge of its oversight powers, is relying on its interpretation of Sections 88 and 89 of the Constitution of the Federal Republic of Nigeria and wishes to acknowledge as follows: That Nigeria is currently operating a Presidential System of Government, which is anchored on the Principle of Separation of Powers.

“What the lawmakers are seeking to do by reason of their action is an Executive responsibility currently being discharged by the Federal Inland Revenue Service (FIRS), which has the statutory responsibilities to assess, collect and account for taxes, conduct audit / inspection of the books of tax payers and penalize defaulters. 

“It is on record that the FIRS has indeed done an excellent work of audit and inspection, which explains the astronomical increase in the level of tax revenue in the last six to seven years”, the statement noted.

“That the oversight powers, as encapsulated in Sections 88 and 89 of the Constitution, are expected to be exercised under the following conditions and circumstances: If the subject matters are monies appropriated or about to be appropriated by the National Assembly; and if the organisations to be investigated are Ministries, Departments and Agencies (MDAs) involved in the disbursing or administering of monies appropriated or to be appropriated by the National Assembly.

“That in discharging these responsibilities, it is only the House of Representatives or its duly appointed Committee that is conferred with the power of investigation and does not permit any other person/group by whatever name called to assume that responsibility on its behalf.
“That is to say that the power shall not be sub-delegated. It therefore, seems not in tandem with the Constitution for the lawmakers to appoint any person or body as constituting either a Member of the House of Representatives or part of the Committee of the House of Representatives.

“That we have on record court ruling on the illegality of appointing consultants to recover tax. On account of this judgement, the lawmakers have contravened the law by appointing a private firm to carry out statutory responsibilities of audit and investigations that are the sole functions of designated Agencies of Government”, it added.

The OPS stressed that due to the earlier analysis, the House Committee on Finance may have inadvertently acted outside its power of investigation as spelt out in sections 62, 88 and 89 of the Constitution by appointing a private consulting firm to carry out the tax audit and inspection on its behalf.

It said the OPS would not support or condone any action by our members that would amount to wilful disobedience of the laws of the land, including prompt payment of legitimate taxes and levies.

It opined that the House Committee on Finance has unduly broadened its mandate and hence may not persuade its members to comply with the purported tax audit and investigation. It therefore implored the Committee to reconsider the appointment of its aforementioned firm of consultant in the interest of the national economy and the rule of law.  

Tags: Nigeria, Featured, Business, IBRAHIM LAMORDE

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