The Minister of Finance, Mrs. Kemi Adeosun, has explained that the newly launched Voluntary Asset and Income Declaration Scheme (VAIDS) is a credible platform put in place for defaulting Nigerian taxpayers to work out a flexible way to pay their outstanding tax liabilities.
Speaking in Abuja shortly after the launch of the new Voluntary Asset and Income Declaration Scheme by the Acting President, Professor Yemi Osinbajo recently, the Minister said the Scheme offers a 9-month window to allow Nigerians, who may have evaded tax, whether ignorantly or deliberately, in the past six years, the opportunity to do their civic duty and pay the correct taxes, thereby avoiding criminal prosecution at the expiration of the scheme.
The Scheme embraces all Federal and State taxes such as Companies Income Tax, Personal Income Tax, Petroleum Profits Tax, Capital Gains Tax, Stamp Duties, Tertiary Education Tax, Technology Tax, Tenement Rates, and Property Taxes. It also covers all back taxes for the last six years in line with the statutory periods of limitation under the relevant tax statutes.
The Minister further disclosed that one great benefit of participating in the Scheme is that taxpayers would be free to transfer assets that they had previously held in nominee and other names into their own name.
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“Those who fail to take advantage of the scheme and are later found to have under declared their taxes or assets will be treated as willful tax evaders and will therefore face the full force of the law and will not be shielded by anonymity”, Mrs. Adeosun stated.
Adeosun also clarified that VAIDS is not restricted to overseas income and assets, as it also covers income derived from part-time businesses, vocations, professions and economic activities other than the main or principal sources of incomes accruing to taxpayers.
“The idea of the scheme is that it is a voluntary programme, the decision to participate should therefore be left to the taxpayers. The FIRS and other Relevant Federal and States Tax Authorities shall give effective publicity to the program and encourage as many people as possible to take advantage of it. This will also be complemented by the Community Tax Liaison Officers. Intending participants in the Scheme are advised to confirm the extent of their Nigerian tax liabilities with their professional advisers”, she stated.
Under the various relevant laws, tax evasion is a crime, which is punishable upon conviction by imprisonment of up to 5 years, while the tax payer is still liable to pay the tax due with interest and penalties.
In most cases defaulters are subject to a penalty of 10% of the tax due and interest at 21% per annum. In some cases the penalty is 100% of the tax due and the defaulters’ assets are liable to be forfeited.