Tax Evasion: FIRS Seals Off PAN Premises

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By Davidson Iriekpen
The premises of Peugeot Automobile of Nigeria (PAN) were yesterday sealed off by officials of the Federal Inland Revenue Service (FIRS) over non-payment of accumulated tax of about N1.291 billion which is from 2005 to 2008.

The workers of the automobile company were caught unawares, as FIRS officials besieged the PAN premises around 2pm in six vehicles and blocked the main entrance with their vehicles.

The FIRS officials were led by the Coordinating Director, Compliance and Enforcement Group, Dr. Teju Somorin, and Mr. Ajayi Bamidele.

THISDAY gathered the revenue workers after blocking the gate of PAN, went to meet the Group Managing Director, Mallam Shehu Dauda, who was the most senior officer around.

The meeting with Dauda was not successful as sources said it degenerated to a situation whereby hot words were exchanged between the MD and FIRS officials.

It was also gathered that PAN's Legal Adviser /Company Secretary, Adamu Mohhamed, later had a meeting with the revenue officials. While the meeting was in progress, other FIRS officials started carrying out their inventory and around 3pm began moving files, computers and other documents to their vehicles.

It was learnt that the meeting was deadlock after 45 minutes as the FIRS officials insisted that the company must make a commitment of paying 75 per cent of the accumulated tax before they could leave.

But the PAN officers said the firm could only come up with N70 million, promising to pay the rest of the money in some few days, which the revenue collectors refused.

Following the disagreement, the revenue collectors went away with all the files and documents which were taken from PAN offices away and sealed off the premises of the automobile company.

The FIRS officials asked the workers in the firm to leave the premises.

Speaking to journalists after the seal-off of PAN premises, FIRS' Director in Charge of Tax Department, Ajayi Bamidele, later told newsmen that the liability of PAN was made up of “Company Income Tax and Education Tax”.

According to him, “The company income tax is made up of about N800 million, the education tax is about N101 million. We have withholding tax which is N1.6 million and we have the Value Added Tax (VAT) which is about N200 million that they are owing. For that of PAYE, since we are not controlling Kaduna State, we cannot determine how much they are owing.

“On the issue of whether they agree with the figure we gave them or not, we have had reconciliation meetings with them. We have discussed with them in the past before we got to the total of that N1. 29 billion that we said they are owing.

“But in their own records, according to them, they agreed they are owing N628 million, which excludes interest and penalty which we have included in our own. That is the substantial difference that we have.

“After discussing with us, we told them what they are owing, it looks like they were not really prepared to pay and as a result, we had to seal off the place and go away pending the time they would be prepared to pay.

“The money we are asking them to pay, especially VAT, is not their money; it is the money they collected on behalf of FIRS.”

Reacting to FIRS action, the General Manager, Commercial Division of PAN, Umar Isa Kaita, said: “We have sat down with them on this figure. Yes, there are some tax issues that were yet to be settled, but we are all witnesses to the downturn in the economy. There is no doubt that yes you can record a sale, but it is another thing to receive money for the sale that you have recorded.

“We have so many monies that have not come into our coffers, particularly from government. If you go round the factory, you will see a lot of stock of vehicle, and these cars were produced because of an understanding we have with the Federal Government of Nigeria on a scheme called PCCS.”

He said the scheme was for civil servants, adding that PAN had signed an MoU with the Federal Government in which had prompted it to produce the vehicles.

Unfortunately, he said, the scheme had been stalled as the company had not been paid by the Federal Government, adding that the firm had written several letters to the government about the issue, but it had not been paid.

“The problem is that the authorities of the FIRS would look at your book and once you have recorded a sale, you are expected to remit tax. We are a responsible corporate organization and we are going to do all that is possible to pay the money.”

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