THE House of Representatives yesterday resolved to issue a warrant of arrest on chief executive officers of telecommunication companies (telcos) operating in the country for tax evasion offences.
It vowed to effect the arrests in seven days, should they fail to honour a second invitation to them.
The CEOs, a few days ago, ignored an invitation extended to them by the House Committee on Finance probing revenue leakages. Section 88 and 89 of the 1999 Constitution gives the National Assembly quasi-judicial powers to invite anyone, issue bench warrants and prescribe penalties and fines, for contempt offences.
The House threatened to wield the big stick, after adopting a motion by James Faleke(APC-Lagos),
In taking the piece of legislation, the House noted the precarious economic situation Nigeria currently found itself, heightened by the global economic recession, driven in part by the coronavirus pandemic, and the unfortunate crash in international oil prices.
The House in adopting the motion observed that the current price of crude oil in the international market was below $29 per barrel, P/B, approximately 50 per cent down from the budgetary projection of $57P/B, raising concerns that the continued dependence on oil revenue to fund programmes and projects of government was not sustainable.
The lawmakers, however, expressed worries that the existing corporate tax revenue leakages are hindering the diversification of the nation’s revenue base.
They observed the huge revenue leakages of over $30billion attributable to corporations which systematically evade the remittance of the appropriate taxes, despite public declarations of exorbitant revenues and profits.
The motion recalled: “The House at its sitting of March 5, 2020, acting in line with the provisions of Sections 62, 88 and 89 of the Constitution, empowered, via a resolution, its Committees on Finance, and Banking and Currency, with assistance from other relevant government agencies to conduct in-depth Investigative hearings into all incidences of corporate tax revenue leakages.
“The sole objective of these investigations by the House is to ensure that Nigeria’s tax regime remains fair and competitive, and expected tax revenue by any organization and/or individual is paid appropriately and accordingly into the government treasury.
“The Committee on Finance and Banking and Currency, in furtherance of its obligations as directed by the House, issued letters of invitation to various corporations to submit documents of their full compliance with the Laws of the Federation, but was amazed that some of these corporations, particularly telecoms operators, under the aegis of Incorporated Trustees of Association of Licensed Telecommunications Operators of Nigeria, upon the receipt of the letters of invitation, chose instead to file cases in court.’’
The House noted with shock that a judgment in favour of the National Assembly was delivered on March 13, 2020, by Her Lordship, B.F.M. Nyako J, which reiterated that ‘the National Assembly is empowered by sections 88 and 89 of the constitution to invite any persons for investigative purposes.
The House said yet, the telecoms operators, under the aegis of Incorporated Trustees of Association of Licensed Telecommunications Operators of Nigeria, have contested the powers of the National Assembly, and have filed an appeal, seeking an injunction to restrain the National Assembly from “investigating [their] business, operations and policies, summoning [them], requesting any documents or books from [them], conducting any investigative hearing or meetings against [them], making oversight visits to [their] offices or premises for the purposes of investigating or demanding information.”
In his adopted motion, Faleke explained: “The injunction being sought in the Appeal, is nothing but an attempt to tie the hands of the National Assembly, and render it useless and incapacitated in carrying out her constitutional and legislative roles as assigned to it by the 1999 Constitution of the Federal Republic of Nigeria (as amended).
“The House is concerned that the Notice of Appeal is intended to both distract and delay the conclusion of the oversight functions of the Committee in respect of the various documented infractions committed by these corporations.
“The House is aware that the $30 billion tax revenue leakage is based solely on documented evidence, this is not a fishing expedition, or an attempt to harass any law-abiding entities; compliance with our letters of invitation will afford any persons or organization the opportunity to challenge any false allegations”.
The House, in adopting the motion, resolved to invoke sections 89 (1)(d) & (2) of the 1999 Constitution of the Federal Republic of Nigeria (as Amended)89 (1)(d) “…to issue a warrant to compel the attendance of any person who, after having been summoned to attend, fails, refuses or neglects to do so.
The House also, in deciding on the motion, sought “an amendment of the Company Income Tax Bill 2020 currently awaiting the assent of the President of the Federal Republic of Nigeria.
The amended section read: “Any company or persons indicted by National Assembly that fails or refuses to pay or remit statutory revenue, returns to the Federal Government through the appropriate quarters should have its directors criminally prosecuted for violation of our tax laws, barred from further business operations in the country and the company blacklisted and delisted from the register of the Corporate Affairs Commission”.
Speaker of the House, Femi Gbajabiamila, in ruling on the motion, advised the Finance and Banking advised the committee, to send a fresh letter of invitation to the defaulting companies and ask them to appear before it in seven days.
He warned that the House would activate its powers to punish failure to honour them if the said companies’ bosses failed to respond a second time.
The first time the House of Representatives caused the arrest of any official for failing to honour their invitation was in 2006 when the then Chairman of the House Committee on Appropriations, Gabriel Suswam, caused the arrest of the then Finance Minister, Dr. Ngozi Okonjo-Iweala, for failing to appear at a scheduled time to defend subheads in a budget.