A recent report from the Office of the Auditor-General of the Federation (OAuGF) has unveiled tax irregularities amounting to N14.33 billion across over 30 Ministries, Departments, and Agencies (MDAs) of the Nigerian government.
The findings, published in the *Auditor-General’s Annual Report on Non-Compliance and Internal Control Weaknesses*, spotlight significant lapses in tax deductions, remittances, and financial compliance during the 2020-2021 fiscal period under the administration of former President Muhammadu Buhari.
The report detailed two categories of violations: under-deduction of taxes and complete non-deduction of taxes, both of which contravene Nigeria's financial regulations.
MDAs in Breach
According to the audit, six MDAs were responsible for under-deducting taxes amounting to N129.34 million. Among them, the Federal Road Safety Corps (FRSC) in Abuja was cited as the largest offender, with a discrepancy of N90.57 million. The Federal Ministry of Labour and Employment recorded the smallest shortfall of N623,162.
The audit further revealed that 21 MDAs failed to deduct taxes entirely, resulting in a combined irregularity of N2.64 billion. The Nigerian Security Printing and Minting Company (NSPMC) in Abuja topped this list with N1.01 billion in unpaid taxes, while the Federal Medical Centre in Ebute Meta was the least offender, with N617,427.
Key Observations
The audit highlighted systemic breaches of Paragraphs 234 and 235 of the Financial Regulations (2009), which mandate the prompt deduction and remittance of applicable taxes such as Value Added Tax (VAT) and Withholding Tax (WHT) to the Federal Inland Revenue Service (FIRS).
Other agencies implicated in the under-deduction category include:
- Federal Polytechnic Bida, Niger State
- National Water Resources Institute, Kaduna
- Council for the Regulation of Freight Forwarding in Nigeria
The report also criticized non-compliance with regulations regarding contractor payments, which exacerbated the revenue shortfall.
Broader Implications
The irregularities raise concerns about fiscal discipline and accountability within key government agencies, potentially undermining Nigeria’s tax revenue base. The findings underscore the need for stricter oversight and enforcement mechanisms to ensure compliance with financial regulations.
As of now, there has been no public response from the MDAs cited in the report, while the Federal Inland Revenue Service is expected to take corrective measures in collaboration with the OAuGF.
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