BusinessDay

Reps summon ministry of trade officials over MTN’s N2.6trn tax evasion

The House of Representatives’ Public Account Committee resolved that all the officials from the federal ministry of trade and industry involved in the N2.6 trillion capital allowances granted to MTN should appear before it for explanations.

The Committee also requested for the tax records covering the periods under review from both MTN and federal inland revenue service for further legislative scrutiny.

The House panel reached these resolutions at the resumed investigative hearing on the Audit queries on tax evasion issued by the office of the Auditor General for the Federation (oAuGF) on Tuesday.

Oluwole Oke, Chairman, House Committee on Public Accounts disclosed that the oAuGF report indicated that the documents relating to the N2.6 trillion capital allowances were allegedly forged.

While stressing that the Committee invited MTN over tax evasion, Oke explained that the oAuGF in its report observed that FIRS accorded value to the telecoms company and in some cases without certificates and evidence of capital allowance issued by federal ministry of trade and industry, reflecting the whole assets procured by the company.

He said: “We have issues in this country where funds are not adequate for Government to carry out policies and programmes which is why we had to borrow even though there are massive revenue leakages.

“MTN has also made appearances where N2.6 trillion was seen as the taxable value for assets of the company and we asked as to where they exist and who verified them, because they had already claimed value for them with the FIRS.”

Oke maintained that Nigerians have rights to know the implications of MTN taking a certificate of N2.6 trillion to FIRS for tax waivers on the economy.

According to him, “the Parliament simply wants to know whether it should sustain the query raised by the Auditor General or absolve the company of the allegations of tax evasion as it would be wrong to accuse it of such if these records tally with the comany’s submission.

“The issue says that we should speak to facts and law. You’re here when we asked the Industry Ministry and they said both the local and foreign contents were the certificates they issued to you.

“However, Auditor General says such issuance appears to have been falsified which was the basis of its query to you.”

MTN’s General Manager, Yemisi Adebayo explained that the Company has submitted all relevant documents issued by Federal Ministry of Trade and Industry reflecting the value of N2.6 trillion given to MTN.

Responding to questions on the 2016 inspection relating to the capital allowances granted to the company, Adeleye said the company made claims to the ministry at the end of the year prompting them to choose a location and inspect as it was physically impossible for them to inspect thousands of assets across the country; hence the ministry, “based on their selection using supporting documents granted the allowances.”

Read also: Sweet, Sweet, Tax?

While giving details on the claims made by the company for capital allowance, she disclosed that the sum of N18,967,410,769 was claimed in 2016, adding that: “total sum of N148 billion capital allowance was granted to the company, N210 billion was approved in 2018 after the visit to Ojota Switch as well as N190,629,586,000 in 2019 following visit to the Port Harcourt switch.

When asked if all the assets procured by the company in 2019 were all located at the Port Harcourt switch, she responded in the negative.

She added that in 2020, the Ministry officials visited Abuja Switch, another team visited Ojota switch, while another visited Port Harcourt and granted capital allowance worth N219,540,623,545.

When asked if she would agree to give out a value of N219 billion based on one inspection that visited just three locations out of over a thousand locations, she said the company only filed what was approved by the inspection team with the FIRS for consideration.

But Oke reiterated the Committee’s resolve to ascertain the patriotic and professional involvement of the ministry officials, saying that the parliament cannot fold its arms and watch when people whose salaries and allowances were appropriated to do a job failed to carry out their duties under the law.

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