(L-R) Mr G. Folayan, MD/CEO, Equtorial Trust Bank discussing with Dr. Uju Ogubunka, registrar/CE, CIBN, at a one day national policy seminar on 2011 federal government budget in Lagos, Nigeria.
The Central Bank of Nigeria (CBN) and the Federal Internal Revenue Service (FIRS) have joined forces to ensure that banks operating in the country comply with all relevant guidelines on remitting revenue due to the federal government. BusinessWorld Intelligence can disclose that the partnership between the two agencies has given rise to a new policy which makes it mandatory for revenue-collecting banks to pay all monies collected on behalf of the federal government within 48 hours.
The FIRS has been having a running battle with banks over prompt remittance of revenue they collect on behalf of government and its agencies. The non-compliance of the guidelines have made it possible for the banks to play games with government revenue before remitting same to the relevant accounts of the ministries, departments and agencies (MDAs).
Number (TIN) from corporate bodies before they could open corporate accounts. Analysts said the move by CBN and FIRS would not only boost the revenue profile of government but would also plug loopholes in the collection of revenue from tax payers. The analysts are also of the opinion that adequate sanctions should also be extended to relevant officials of the FIRS who may have been colluding with bank officials to delay the remittance of money due to government.
However, the apex bank and the FIRS have moved to ensure that revenues accruing to government are promptly remitted to the relevant accounts. At a meeting held recently between the two bodies, all loopholes were identified and efforts made to plug them. One of the high points of the meeting was the decision to invoke regulatory sanctions on banks that fail to remit the revenue so collected within 48 hours. Competent sources at the meeting disclosed that such defaulting banks may be forced to pay interests at commercial rates on the delayed remittance.
The meeting, among other things, agreed that all lead banks for FIRS collections should ensure prompt remittances to the relevant pool accounts within 48 hours of receipt of funds from the tax payers. The banks were also mandated to ensure that proper narrations are made when sending remittance instructions to the apex bank.
In order to ensure proper tax assessments, the two bodies agreed that all banks are to ensure full disclosure of salaries and allowances earned by their employees. The full disclosure would also be applicable to executive management staff and board members.
The meeting also moved to ensure that more corporate bodies are brought into the tax net of government. To this end, it is now mandatory for all banks to demand and receive the Tax Identification.