Oil Swap: Transfigura, Duke Oil Owe $651m In Taxes – FIRS | Independent Newspapers Limited
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Oil Swap: Transfigura, Duke Oil Owe $651m In Taxes – FIRS

Posted: Mar 3, 2016 at 6:00 am   /   by   /   comments (0)

The Federal Inland Revenue Service (FIRS) on Wednesday disclosed that two major oil marketers engaged by Petroleum Pricing Marketing Company (PPMC) for crude oil for petroleum products swap, otherwise called ‘oil swap,’ failed to pay four years’ taxes worth $651 million.

Olayemi Ajayi, FIRS Director, gave the information while addressing Zakari Mohammed, chairman and members of the House of Representatives ad-hoc committee investigating oil swap agreement estimated at $24 billion.

Ajayi explained that Transfigura defaulted in paying taxes worth $642,536,470 while Duke Oil owed $4,734,997.17 on imported petroleum products under the crude oil swap for products transaction between 2010 and 2014.

He added that Duke Oil recorded liabilities of $19.203 million in 2011; $20.812 million in 2012; $20.168 million in 2013 and $18.917 million in 2014, totaling $78.917 million out of which 6 percent tax of $4,734,997.07 is yet to be paid to FIRS.

Ajayi also alleged that Duke Oil has not rendered returns based on the finished products at 20 percent; hence “Duke Oil’s commission is unknown to FIRS.”

While the investigative public hearing on the oil swap was going on, Femi Falana, Lagos-based lawyer and activist, who attended the event, applauded the efforts of the House of Representatives to tackle criminality and corruption perpetuated by previous public office holders.

“Since you have indicated that you are rising, I will prefer to see you (chairman of the ad hoc committee) in chamber. But let me pledge our solidarity with your work and to assure you that some of us have seen the good work of the National Assembly particularly the House of Representatives that is very proactive…Particularly when you are trying to get to the root of the criminalities and the way and manner our country has been duped by some forces. We wish to collaborate with you fully,” Falana said.

While giving update on the activities of Customs on importation of petroleum products, Anthony Ayalogu, NCS Assistant Comptroller (Trade and Tariff), informed the committee that Customs had been prohibited from participating in the verification and ascertaining of the actual petroleum products imported through a letter that emanated from a former Permanent Secretary of Federal Ministry of Finance in 2008.

He explained that requisite protocols were breached by PPMC and its partners by failing to declare to Customs the content of vessels of imported petroleum products and crude oil exported in line with extant laws.

Ayalogu said that worried by the security implication of the purported letter signed by a former Permanent Secretary of Federal Ministry of Finance, which barred Customs from inspecting and ascertaining the actual imported petroleum products, Mohammed who directed that the letter be set aside immediately, mandated the NCS Comptroller General to verify and ascertain the vessels of imported petroleum products through the waterways by all parties.

In his submission, Toby Okechukwu, member of the ad hoc committee who alleged that “Transfigura did not import any petroleum products into the country,” noted that the findings led to the investigative public hearing.

Okechukwu, who expressed concern over the security implication of the exclusion/suspension of Customs from its constitutional functions, argued that “continuous breach of the Excise and Duties is not healthy for the Nigerian economy.”

Aisha Katagum, PPMC representative had earlier denied knowledge of the copy of the letter which excludes Transfigura from paying requisite taxes on the transaction.

She, however, affirmed that other oil marketers, namely, Ontario, Televaras and Duke Oil paid from the commission due to their companies in respect of the oil swap transaction.

Mohammed then directed the former permanent secretary to appear before the committee to explain the rationale behind the “love letter” that led to the suspension of Customs from performing its statutory functions by ascertaining the amount of petroleum products imported.

He maintained that the letter should be set aside immediately.

“We believe that you have to do your job. As far as we are concerned, you are established by the Act of Parliament and cannot be stopped by mere letter from a Permanent Secretary because that letter is susceptible to denial.

“Imagine what would have come into this country unchecked from 2008 till date,” Mohammed lamented, just as he warned against further default in tracking the imported petroleum products through the ports.

Mohammed had earlier expressed concern over the claim by Transfigura that it cannot pay taxes since it did not reside in Nigeria.

He, however, failed to give the committee’s position on the non-appearance of Diezani Alison-Madueke whom it summoned to appear yesterday.

Alison-Madueke also failed to send apology letter and correspondence to the ad hoc committee when the hearing ended.

Alison-Madueke is currently standing trial in United Kingdom on allegations bordering on money laundering and corruption.