Tax evasion: Union Bank, Ecobank risk losing branches

Union Bank and Ecobank risk losing all their branches in Akwa Ibom after they were shut down with their operations placed on hold over allegations of tax evasion by the Akwa Ibom state government.

 The State High Court, Uyo Division ordered the closure of the banks’ branches, with an order to sell them within fourteen days.

The decision made by the court was prompted by an application filed by Akwa Ibom State Internal Revenue Service (AKIRS) accusing both banks of tax evasion.

According to a report, a notice pasted outside the branches reveals that the banks “have not been remitting the actual tax-deductible from their employees’ salaries and other relevant taxes due to the state, hence, failed to comply with the provisions of relevant tax laws.”

The court granted an ex parte order to recover the state revenue. Although the amount wasn’t disclosed, the debts were said to run into millions of naira. And to recover the debts, AKIRS has received a mandate to sell the branches if the banks don’t negotiate with it within the next 14 days.

“After 14 days of non-compliance, we have the mandate of the court to sell the property and recover the tax owed the state.”

The tax agency said it tried to resolve the tax issue out of court but Ecobank and Union Bank neither honour invitations nor reply the letters sent to them. This provoked the Akwa Ibom’s tax agency to seek redress in court.

Ecobank and Union Bank are, however, not the only organisations involved in the tax evasion according to the tax agency. It was revealed that billions of naira are stuck with over 200 companies trying to evade state taxes.

The Director, Enforcement and Recovery of the tax authority, Leo Umanah, reiterated AKIRS’ commitment to recover revenues owed to Akwa Ibom State in order to enable the government work and conclude state projects.