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Alarm as 7,000 billionaires evade taxation in Nigeria

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 Nigerian President Muhammadu Buhari
Nigerian President Muhammadu Buhari. FILE | AFP PHOTO 

Tax experts are demanding stricter punishment for defaulters, claiming they were largely to blame for Nigeria’s external debt of more than $33 billion

The experts expressed the sentiments after the Federal Inland Revenue (FIRS) revealed that close to 7,000 billionaires in Nigeria had defaulted from paying tax.

FIRS said it would soon go after the bank accounts of the defaulters.

Speaking in Abuja, the tax experts called for a probe on politicians who were spending millions of naira to secure party nominations for next year’s General Election.

“There is a need for stricter punishment on tax evaders in the country,’’ Prof Sheriffdeen Tella, a Senior Economist at the Olabisi Onabanjo University in Ogun State, said.

“Tax evaders are sent to jail in other countries.’’

The economist insisted that FIRS should probe the tax records of politicians who were spending a fortune to collect forms for their party primaries.

Mr Seyi Alade, the Lagos State Internal Revenue Service (LIRS) legal director, also attributed incessant evasion to non-prioritisation of taxation by the Federal Government.

He pointed out that for more than 6,772 billionaire accounts to have evaded tax, meant less revenue to the government to fund critical services.

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Mrs Oso Afolake, the Assistant Director of the Chartered Institute of Taxation of Nigeria (CITN), blamed the rampant tax evasion on weak system, which she said could be fixed by the government.

“Tax evasion results to reduction in revenue and this will deprive government the resources to perform its statutory duties,” she said.

The president of the International Centre for Tax Research and Development, Mrs Morenike Babington-Ashaye, urged the government to nurture Nigerians’ attitude towards voluntary compliance to tax law.

Mrs Babington-Ashaye also argued that using the banks to go after defaulting taxpayers was not a legitimate process.

The CITN founding member described the FIRS’s process of asking the banks to seize money as ‘going to the back door’.

That, she said, might lead to customers not saving their money in the banks, thereby reducing their resources for operation.

PwC West Africa Tax Leader Taiwo Oyedele argued that all taxation measures should be in accordance with the law to avoid negative impacts on businesses.

Another tax expert, Mr Kunle Quadri, said paying taxes was one of the most effective means for the redistribution of wealth.

Mr Quadri, a former president of the West Africa Institute of Taxation, said that paying of taxes at all levels was one of the most responsible deeds, and also sacrosanct to ensure that government meets it obligations.

“We needs to pay our taxes as it is one of the most patriotic deeds and enables government to meet its own part of the bargain to the electorate,” he said.

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World Bank pushes G-20 to extend debt relief to 2021

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World Bank Group President David Malpass has urged the Group of 20 rich countries to extend the time frame of the Debt Service Suspension Initiative(DSSI) through the end of 2021, calling it one of the key factors in strengthening global recovery.

“I urge you to extend the time frame of the DSSI through the end of 2021 and commit to giving the initiative as broad a scope as possible,” said Malpass.

He made these remarks at last week’s virtual G20 Finance Ministers and Central Bank Governors Meeting.

The World Bank Chief said the COVID-19 pandemic has triggered the deepest global recession in decades and what may turn out to be one of the most unequal in terms of impact.

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People in developing countries are particularly hard hit by capital outflows, declines in remittances, the collapse of informal labor markets, and social safety nets that are much less robust than in the advanced economies.

For the poorest countries, poverty is rising rapidly, median incomes are falling and growth is deeply negative.

Debt burdens, already unsustainable for many countries, are rising to crisis levels.

“The situation in developing countries is increasingly desperate. Time is short. We need to take action quickly on debt suspension, debt reduction, debt resolution mechanisms and debt transparency,” said Malpass.

ALSO READ:Global Economy Plunges into Worst Recession – World Bank

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Kenya’s Central Bank Drafts New Laws to Regulate Non-Bank Digital Loans

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The Central Bank of Kenya (CBK) will regulate interest rates charged on mobile loans by digital lending platforms if amendments on the Central bank of Kenya Act pass to law. The amendments will require digital lenders to seek approval from CBK before launching new products or changing interest rates on loans among other charges, just like commercial banks.

“The principal objective of this bill is to amend the Central bank of Kenya Act to regulate the conduct of providers of digital financial products and services,” reads a notice on the bill. “CBK will have an obligation of ensuring that there is fair and non-discriminatory marketplace access to credit.”

According to Business Daily, the legislation will also enable the Central Bank to monitor non-performing loans, capping the limit at not twice the amount of the defaulted loan while protecting consumers from predatory lending by digital loan platforms.

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Tighter Reins on Platforms for Mobile Loans

The legislation will boost efforts to protect customers, building upon a previous gazette notice that blocked lenders from blacklisting non-performing loans below Ksh 1000. The CBK also withdrew submissions of unregulated mobile loan platforms into Credit Reference Bureau. The withdrawal came after complaints of misuse over data in the Credit Information Sharing (CIS) System available for lenders.

Last year, Kenya had over 49 platforms providing mobile loans, taking advantage of regulation gaps to charge obscene rates as high as 150% a year. While most platforms allow borrowers to prepay within a month, creditors still pay the full amount plus interest.

Amendments in the CBK Act will help shield consumers from high-interest rates as well as offer transparency on terms of digital loans.

SEE ALSO: Central Bank Unveils Measures to Tame Unregulated Digital Lenders

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Scope Markets Kenya customers to have instant access to global financial markets

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NAIROBI, Kenya, Jul 20 – Clients trading through the Scope Markets Kenya trading platform will get instant access to global financial markets and wider investment options. 

This follows the launch of a new Scope Markets app, available on both the Google PlayStore and IOS Apple Store.

The Scope Markets app offers clients over 500 investment opportunities across global financial markets.

The Scope Markets app has a brand new user interface that is very user friendly, following feedback from customers.

The application offers real-time quotes; newsfeeds; research facilities, and a chat feature which enables a customer to make direct contact with the Customer Service Team during trading days (Monday to Friday).

The platform also offers an enhanced client interface including catering for those who trade at night.

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The client will get instant access to several asset classes in the global financial markets including; Single Stocks CFDs (US, UK, EU) such as Facebook, Amazon, Apple, Netflix and Google, BP, Carrefour;  Indices (Nasdaq, FTSE UK), Metals (Gold, Silver); Currencies (60+ Pairs), Commodities (Oil, Natural Gas).

The launch is part of Scope Markets Kenya strategy of enriching the customer experience while offering clients access to global trading opportunities.

Scope Markets Kenya CEO, Kevin Ng’ang’a observed, “the Sope Markets app is very easy to use especially when executing trades. Customers are at the heart of everything we do. We designed the Scope Markets app with the customer experience in mind as we seek to respond to feedback from our customers.”

He added that enhancing the client experience builds upon the robust trading platform, Meta Trader 5, unveiled in 2019, enabling Scope Markets Kenya to broaden the asset classes available on the trading platform.

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