The Acting President, Yemi Osinbajo, on Thursday, signed an Executive Order legalizing the Voluntary Asset and Income Declaration Scheme, VAIDS, which was formally unveiled, at the Presidential Villa, Abuja.
The new law is expected to ensure payment of taxes and punishment for offenders, after a nine-month period of moratorium by the government to defaulters.
Osinbajo while unveiling VAIDS, said the scheme would cover companies’ income tax, personal income tax, petroleum profit tax, capital gains tax, stamp duties and tertiary education tax.
According to him The scheme will be operated from July 1, 2017 to March 31, 2018. It will be supported by an executive order, which I will sign into law today to offer a once in a life time opportunity to those in default to regularise their tax affairs. In exchange for full and honest declaration, tax evaders will receive immunity from prosecution, forgiveness of penalty and interest that is due on unpaid taxes. They will also get the full assurance that all information provided will remain confidential”.
Explaining the scheme further the acting president said “In addition, participants in the scheme will not be selected for audit investigation for the period. We understand that some tax payers may have problems raising cash and for that reason, we have built in a system that will allow those owing to pay over a period of time.’’
Osinbajo warmed that those who failed to take advantage of the nine months grace period would face criminal investigation and prosecution and may face up to five-years jail term.
“We have agreed that every Thursday starting from today, and for the next one year will be declared Tax Thursday. We expect the Federal Inland Revenue Service (FIRS) and every state government to organise sensitisation events that would raise awareness of the tax system to ensure massive enrollment of new tax payers”.
He noted that government planned to enroll about four million tax payers with a view to increasing the estimated 14 million already registered tax payers.
“We expect that all state governors will personally lead this initiative and support the work of the 7,500 community tax liaison officers that would be employed shortly.’’
On the international front, Osinbajo said: “Nigeria is now a party to the automatic exchange of information which comes into effect in January, 2018.’’
“This means that Nigeria will automatically have all the information to successfully pursue tax evaders across the world. Specifically, we will have information on beneficial owners of assets held abroad, including those in tax havens,” he said.
The Chairman of Nigeria Governors Forum, (NGF) Abudulaziz Yari, said the governors would key into the program and ensure that it success adding that on the long run, the state governments would be the biggest beneficiary of project.
In her address, Minister of Finance, Mrs Kemi Adeosun, said that VAIDS initiative if effectively implemented would increase the nation’s Gross Domestic Product (GDP) from six per cent to 30 per cent within a short period of time adding that “If we pass this test, the future of Nigeria is assured”.