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Nigerian government chases tax dodgers abroad. New policy targets foreign assets

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The President Muhammadu Buhari-led administration has unveiled a new system to ensure that all taxes on foreign assets of Nigerians due the federal government are remitted to the government’s coffers.

The move, the government believes, will strengthen efforts against money laundering and tax evasion.

The new system is captured in a new Executive Order tagged, ‘Voluntary Offshore Assets Regularisation Scheme (VOARS).’

The Executive Order (008) takes effect from October 8, the day it was signed by President Muhammadu Buhari.

According to Buhari’s media aide, Garba Shehu, by the new order, Nigerian taxpayers who hold offshore assets and income 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,” Shehu said in a statement Wednesday.

He also said that 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 offenses 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.”

Read also: Trump tags Nigeria’s Buhari “lifeless.” What will he say of Uhuru Kenyatta?

He said in accordance with the new order, the federal government, through the office of the Attorney-General of the Federation and Minister of Justice, Abubakar Malami, 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 fulfillment 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, he said, 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.”

In signing the order, Shehu said Buhari noted that under 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 presidential aide 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,” he said.

Politics

Chad’s PM resigns following disputed election of Deby

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Succes Masra, the opposition leader and prime minister of Chad, announced on Wednesday that he had tendered his resignation following the confirmation of Mahamat Idriss Deby as the winner of the May 6 presidential election.

In an attempt to appease the opposition, Masra, a vigorous opponent of the junta that took control in April 2021, was named prime minister of the transitional government in January, four months before the election.

His candidacy was approved in March to hold the presidential election and restore constitutional order to the nation. The oil-producing nation is the first in a line of coup-hit Sahelian republics in West and Central Africa to try a similar comeback.

Masra declared victory before formally releasing the preliminary results, claiming that election fraud was organized. With 61% of the vote, Deby was declared the winner by Chad’s state election board, and the constitutional council subsequently affirmed his victory.

Masra has accepted the council’s decision and stated that there was no alternative way to challenge the outcomes legally.

“In accordance with the constitution, I have today presented… my resignation and that of the transitional government, which has become irrelevant with the end of the presidential
election of May 6,” Masra said on X on Wednesday.

The family has maintained a tight hold on power since Deby’s father overthrew the government in a coup in the early 1990s, and Deby’s triumph strengthens their hold on power.

Deby, the acting president of Chad, was declared the winner of the May 6 presidential election by the state electoral commission two weeks ago. Provisional results show that Deby received almost 61% of the vote. This statement was issued even though the front-runner of the opposition declared himself the winner.

Chad is the first coup-affected nation in West and Central Africa to have successfully returned to constitutional rule through democratic elections, replacing its previous military regime. On the other hand, certain opposition parties have voiced their displeasure over concerns about electoral meddling.

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Kenya’s Ruto to discuss debt relief with Biden this week

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This week, Kenyan President, William Ruto will be hosted by US President, Joe Biden, for extensive negotiations that are anticipated to cover a range of topics, including Kenya’s debt relief as well as the future of Haiti, Ukraine, Sudan, and other regions.

Kenya has been facing severe cash shortages, and a senior administration official quoted by Reuter said that the US is pressuring major creditors like China, which is Kenya’s largest creditor, to provide debtor nations with assistance.

“We think it’s essential that responsible debtors provide reprieves for countries like Kenya, whether that’s by debt service suspensions or via new grant assistance,” the official said.

Additionally, Washington is pressuring global financial institutions to provide Kenya and other nations with affordable funding. During the state visit this week, the official indicated to anticipate some major joint pronouncements about debt relief “on how countries like Kenya can tackle this problem of debt.”

Washington hopes to counter China’s growing influence in Africa, which is one of the reasons it scheduled the high-profile visit by the Kenyan leader.

By collecting debt service payments and limiting follow-on loans, US Treasury Undersecretary Jay Shambaugh warned China and other nations that made large loans to low-income countries last month against free-riding.

The remarks demonstrated the mounting annoyance of debtor countries and Western countries with Beijing’s procrastination about debt restructuring and the glacial pace of debt relief negotiations.

The executive director of Jubilee USA Network, an ecumenical coalition of advocacy, development, and religious organizations, Eric LeCompte, predicted that the Ruto visit would have a significant impact on American policy on Africa.

“When Ruto speaks, he’s speaking for Africa. And given that President Biden hasn’t had the chance to visit Africa yet, this meeting is not only about Kenya, it’s really about sub-Saharan Africa as a whole,” LeCompte said.

 

During a meeting Ruto called last month, African leaders urged that affluent countries make record commitments to the World Bank’s International Growth Association, a low-interest facility that developing countries rely on to help finance economic growth and combat climate change.

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