CEOs Face Imprisonment Over Tax Evasion

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October 05, 2006/ independent

 

 

 

The Senate on Wednesday amended the Companies Income Tax Act and approved a penalty of three to five years’ imprisonment for defaulting heads of organisations that fail to file returns to the Federal Inland Revenue Service (FIRS).


Besides imprisonment, the Senate also approved another fine of N20,000 graduated according to the gravity of the offence.

Effiong Bob, Chairman of the Finance Committee presented the report.

His words: \"The amendment is to ensure that filing of returns which many companies were not doing, there are now appropriate measures and punishments for those who refuse to comply with the law.

\"The new Act ensures that failure to file your companies’ return within a year of starting operations of your business would attract a fine of between N20,000 to N25,000 and subsequently, it could be increased to N50,000 in subsequent years.

\"The directors of the company could also be liable with imprisonment of between three to five years, depending on the discovery of the amount involved.

\"The bill seeks to enhance constitutionalism, transparency and accountability. Some provisions traceable to our military past have also been watered down. The new law will effectively assist the Federal Inland Revenue Service to check tax evasion by companies and to also increase revenue generation.\"


The Act awaits concurrence with the House of Representatives before it is passed into law and thereafter, forwarded to President Olusegun Obasanjo for assent.

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