The President Muhammadu Buhari has stepped up the regulations on money laundering and tax evasion by releasing a new Executive Order No.8, tagged Voluntary Offshore Assets
Regularisation Scheme (VOARS).
Regularisation Scheme (VOARS).
The new Executive Order (008) takes effect from October 8, 2018, the day it was signed by President Muhammadu Buhari.
By this order, 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.
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 offences and offences related to
offshore assets, among others.
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 offences 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.”
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 fulfilment of the terms and conditions as
stipulated in the order, or any other subsequent complementary
regulations that follow.
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 fulfilment 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.”
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.
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.
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 regularisation 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.”
new scheme will help to facilitate the expedient regularisation 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.”
