President Muhammadu Buhari has
released a new Executive Order into law.
The new order is meant to
regulate money laundering and tax evasion.
The President released the new
Executive Order number eight, tagged “Voluntary Offshore Assets Regularization
Scheme, VOARS,” on Wednesday
The new Executive Order (008)
took effect from Monday, October 8, 2018, the day it was signed by President
Muhammadu Buhari.
The Senior Special Assistant to
the President on Media and Publicity Garba Shehu, made this known in a Facebook
post on Wednesday.
Nigerian taxpayers who hold
offshore assets and incomes are expected to, within a period of 12 months,
declare voluntarily those assets and pay taxes on them by the order.
When they do this, they should
expect to derive certain specified benefits.
According to the order, “any
taxpayer who truthfully and voluntarily complies with the conditions of the
scheme, pays a one-time levy of 35 percent on the total offshore assets or pays
all outstanding taxes, penalties and interest after forensic audit of their
offshore assets and income shall obtain immunity from prosecution for tax
offenses and offences related to offshore assets, among others.
“Equally, failure of any
defaulting taxpayer to take advantage of this scheme shall, at the expiration
of the scheme result in investigation and enforcement procedures concerning
offshore assets anywhere in the world pursuant to information now readily
available through automatic exchange of information between Nigeria and foreign
countries.”
In accordance with the new order,
the Federal Government, through the office of the Attorney-General of the
Federation and Minister of Justice will set up a VOARS in Switzerland for all
categories of taxpayers who have defaulted in the declaration of their offshore
assets, payment of taxes due and collectible subject to the fulfillment of the
terms and conditions as stipulated in the order, or any other subsequent
complementary regulations that follow.
To avoid the abuse of this
process, the Federal Government makes clear that the “scheme is open to all
persons, entities, and their intermediaries holding offshore assets and are in
default of their tax obligations in any way, including those who are not already
under investigation by law enforcement agencies in Nigeria or any other country
and have not been charged with any crimes including theft of public funds or
obtaining offshore assets through corrupt practices.”
In signing the order, President
Buhari noted that under the Nigerian law, every citizen has the duty to declare
his or her income and assets and pay taxes on them but regretted that this, in
most instances, had not been the case.
“The sad reality is that efforts
to recover these taxes from defaulters through litigation are often frustrated
by the complications caused by the change in the character and nature of such
assets, insufficient financial intelligence, long delays in courts, among
several other reasons,” the President said.
President Buhari is optimistic
that the new scheme will help to facilitate the expedient regularization of
offshore assets connected to Nigeria and lead to “a new expanded tax base for
the Federal Government, and also fund the Nigeria Infrastructure Fund in
Switzerland.”
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