In an effort to tackle the lingering revenue challenges in Nigeria, the chairman, Federal Inland Revenue Service (FIRS), Zacch Adedeji, has mandated foreign shipping companies to comply with existing tax rules in Nigeria in order not to run afoul of the law.

He said the agency would keep tracking compliance on all taxable firms in the country to ensure the federal government is not shortchanged in any way.

Adedeji gave the charge in Lagos at a workshop on taxation of non-resident shipping companies organised by FIRS in conjunction with Oil Producers Trade Section (OPTS) on Monday.

He said the tax compliance exercise commenced by FIRS on the activities of foreign shipping companies lifting hydrocarbons from Nigeria was part of measures aimed at widening the tax net in order to grow revenue for the government.

The FIRS chairman, according to a statement by his Special Adviser on Media, Dare Adekanmbi, assured the international companies that the agency was only interested in ensuring compliance with extant tax laws and not out to disrupt their operations.

Section 14 of the Companies Income Tax Act (CITA) 2004 (as amended) makes it mandatory for foreign companies engaging in shipping and air transport operations in Nigeria to file tax returns to continue to carry out their businesses within the country.

Adedeji, who prior to his appointment as FIRS chairman was Special Adviser on Revenue to President Bola Tinubu, reminded the companies about how his intervention had earlier led to the six months grace period given to them to regularise their tax returns.

The international shipping companies have up to December 31 this year to reconcile their books with FIRS.

He explained that the purpose of the workshop was to address challenges associated with tax compliance by the foreign companies and find a lasting solution.

“The Federal Government has set a target of increasing Nigeria’s tax to GDP ratio to 18% within the next three years.

“The goal is to achieve this without imposing additional taxes but by broadening the tax net. The compliance exercise on international shipping companies lifting crude oil from Nigeria is in line with this strategy of broadening the tax net.

“I am sure all the international shipping companies that we contacted are aware of the importance of complying with tax laws in the various jurisdictions they operate.

“Therefore, I urge the international shipping companies that are not complying with Nigerian tax laws to begin to do so immediately.

“The Service has noted the concerns raised by stakeholders in the oil and gas industry and the maritime sector regarding the tax compliance exercise initiated on international shipping companies lifting crude oil from Nigeria.

“I wish to state that the Service is aware of the economic importance of the sector and has no intention of disrupting operations, rather the objective is to instil compliance with Nigerian tax laws.

The workshop was attended by members of the International Association of Independent Tanker Owners (INTERTANKO), International Chamber of Shipping, Independent Petroleum Producers Group, government agencies and tax advisers, among others. (Daily Sun)

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