BY BusinessDay staff
Kinfe Kayssay, the Managing Director of Air Nigeria, has been arrested by the Federal Inland Revenue Services (FIRS) for allegedly failing to remit taxes worth N4.868, 496,152 billion, a statement signed by Emmanuel Obeta, FIRS Director of Communications & Liaison’ Department, said.
According to the statement, the tax enforcement drive, led by James Binang, an Assistant Director in charge of FIRS's Debt Enforcement and Special Prosecution Unit (DESPU), was aimed at recovering tax arrears accuring to the government.
The airline was also alleged to have requested and obtained a Tax Clearance Certificate (TCC), giving it a clean bill of health, despite its tax liabilities.
“The arrest is aimed at recovering arrears of taxes accruing to government from Withholding Tax (WHT) and Value Added Tax (VAT),” the statement said. “The enforcement is part of a bigger move to recover the N170. I Billion (N170, 132, 089, 411:46) outstanding taxes owed to government by public and private organisations as well as ensure that all taxpayers are captured in the tax net.”
During interrogation, Kayssay agreed Air Nigeria had tax liabilities but pleaded for more time to clear the bills.
The airline's lawyer, Akeem Babatunde, denied allegations the company collected the TCC.
“Binang explained that the refusal to deduct and remit taxes as well as failure to file tax returns amount to criminal offences,” the statement said. “Explanations were also sought from the company about the Tax Clearance Certificate (TCC) alleged to have been obtained by Air Nigeria despite its tax liabilities—which was a requirement to secure their expatriate quota.
“Kayssay agreed that the company actually had tax liabilities to pay but pleaded for more time to settle the liabilities and comply with the necessary legislations as regards filing of tax returns.
“He said that he will ascertain the reasons why the company did not file tax returns or made payments on the outstanding tax liabilities. “The company lawyer, Mr. Akeem Babatunde, indicated that the company’s did not request for TCC to enable them secure expatriate quota.
“Earlier, the Service had served series of notices on the need for the company to pay their outstanding tax liabilities as well as comply with their tax obligations as specified by Nigerian tax laws or face punitive action.
“Apart from the tax liabilities against Air Nigeria, the company has also failed to file annual ``Tax Returns’’ in 2011, as when due while the one for 2012 is pending.
“Specifically, Section 31 of the VAT Act No 12 of 2007, provides that: `` A taxable person who fails to submit returns to the Board is liable to a fine of N5,000 for every month in which the failure continues’’.
It will be recalled that less than a month ago, the FIRS arrested Chief Executive Officers (CEOs) of seven companies in Lagos for alleged failure to remit taxes totaling N2.17 billion.
The companies involved in that enforcement drive and the amounts are Pivot Engineering Ltd, N609, 911,992:36, Reliance Telecommunications Ltd, N592,756,627:00, HITV Ltd, N309,500,065:55 and UTC Nigeria Plc, N277,589,163:74, Sweet Sensation Confectionary Ltd, N155, 483,013:00, Entertainment Highway Ltd, N197, 444,964:55 and John Holt Nig. Ltd, N33, 073,487:52.
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