The chairman of the Presidential Fiscal Policy and Tax Reforms Committee, Taiwo Oyedele has disclosed that there’s a plan to introduce a new amnesty scheme which will correct the fallings of the voluntary Assets and Income Declaration Scheme (VAIDS) to go after Wealthy citizen evading tax.
The tax amnesty gives tax evaders immunity from prosecution, penalty charges and interest, if they voluntarily declare their previously undisclosed assets and income. Urging tax evaders to come forward and settle their outstanding tax liabilities, Oyedele said “The new scheme will not repeat the mistakes of the VAIDS.”
Oyedele did not specify how much the new amnesty is projected to rake in but VAIDS was supposed to add $1 billion to government revenue.
The collection from the VAIDS was about 6.6 percent of the target, with the policy failing to live up to expectations.
Among the factors that contributed to the underperformance of the scheme were insufficient and unreliable data to track tax defaulters, lack of sufficient and well-trained staff to carry out effective tax administration and revenue collection, massive corruption among tax officials and administrators, lack of political will by the government to pursue tax defaulters, and a lack of public trust in the judicious use of the funds derived from the programme.
However, the introduction of the programme still resulted in a 36 percent increase in the taxpayer database, from 14 million to 19 million taxpayers as of 2018.
Launched on June 29, 2017 under then-President Muhammadu Buhari, the VAIDS sought to boost the country’s low tax base and shore up revenues.
Targeting at least an additional 4 million new taxpayers to the net, the idea was basically to encourage tax defaulters to voluntarily come forward and pay tax arrears without being punished.
