Abuja — The Federal Inland Revenue Service (FIRS) has said that the debt owed federal government as taxes by Ministries, Departments and Agencies (MDAs) has increased to N212 billion.

The Chairman of the Service, Mrs Ifueko Omogui-Okauru disclosed this at the stakeholders' consultative meeting with heads of Finance and Accounts of MDAs held in Abuja, yesterday. She also took a swipe at some banks which she said have been withholding taxes paid to them by government agencies, saying that at a time a bank (not mentioned) was owing the service N6 billion supposed to have been remitted to the government.

Represented by the Co-ordinating Director, Tax Operation Group in the Service, Mr S.S. Ogungbesan, the FIRS boss stated that the debt has increased from N64 billion in 2004 to N212 billion this year. Speaking further Mrs Omogui-Okauru stated that the debt accrued from withholding tax, Value Added Tax (VAT) and personal income tax otherwise known as Pay As You Earn tax, adding that 50 per cent of the debt constituted penalties on the taxes.

The FIRS chairman accused some organisations of shortchanging the federal government by not remitting the taxes even when the money had been deducted at source by the MDAs and other corporate organisations

"Ministries, Departments and Agencies build VAT into contracts but they don't pay the VAT to government, which means, shortchanging the government," she said.

Mrs Omogui-Okauru noted that personal income tax was another major means of owing government, adding companies evade taxes. According to her, the only way to ensure total compliance to tax payment by MDAs was to send tax clearance support officers from the SFIRS to MDAs to work with the heads of Finance and Accounts and ensure that taxes are remitted to the government coffers.

She explained that the aim of deploying tax officer to MDAs was not to monitor the officers or take over their jobs but to assist them in discharging of their duties. While stating that tax clearance certificate was not the only requirement for the award of contracts, Omogui-Okauru said Taxpayer Identification Numbers (TIN) was also necessary, even as she warned MDAs against using their TIN to award contracts to organisations.

In his opening speech, the Deputy Director, Tax Compliance Support Desk, Mr Etim Bassey noted that since the commencement of the tax reform in 2004, FIRS has introduced various strategies to improve tax compliance in the country.

Among such strategies, Bassey explained are enlightenment workshop and occasional visits to ensure that relevant tax information was made available to stakeholders. "It is our desire to attain a level where tax payers and agents of collection would comply with laws voluntarily," he said.