N14bn Tax Fraud Unraveled: Over 30 Ministries Caught In Major Financial Scandal

N14bn Tax Fraud Unraveled: Over 30 Ministries Caught In Major Financial Scandal

A new report by the Auditor-General of the Federation has revealed tax irregularities totaling N14.33bn across more than 30 Ministries, Departments, and Agencies (MDAs). The findings, contained in the Auditor-General’s Annual Report on Non-Compliance and Internal Control Weaknesses,..…..READ MORE 

point to severe lapses in tax deductions, remittances, and adherence to financial regulations for the period of 2020 to 2021.

The audit exposed that six MDAs were responsible for a combined N129.34m in under-deduction of taxes. Paragraphs 234 and 235 of the Financial Regulations (2009) specify that accounting officers must ensure taxes like Value Added Tax (VAT) and Withholding Tax are properly deducted and remitted to the Federal Inland Revenue Service (FIRS).

The Federal Road Safety Corps (FRSC) in Abuja emerged as the biggest offender, with a N90.57m under-deduction. The smallest discrepancy was recorded by the Federal Ministry of Labour and Employment, which had a shortfall of just N623,162.80.

The audit report highlighted N2.64bn in unpaid taxes across 21 MDAs, with the Nigerian Security Printing and Minting Company (NSPMC) in Abuja leading the non-deduction category with N1.01bn, while the Federal Medical Centre, Ebute Meta, reported the smallest shortfall of N617,427.66.

Furthermore, the audit found that 11 MDAs failed to remit taxes they had deducted, with the NSPMC again leading this breach with N10.39bn in unremitted funds. The Federal Medical Centre in Katsina was the least offender, with just N1.37m unremitted.

The report also uncovered N69.93bn in unrecovered tax liabilities at 26 FIRS outstations across the country, with the highest amount, N26.32bn, concentrated in the FIRS offices in Akwa Ibom, Cross Rivers, and Bayelsa States.

The findings reveal significant weaknesses in tax enforcement and highlight the urgent need for stronger compliance and oversight to ensure proper tax deductions, remittances, and recoveries.

The Auditor-General has called for immediate corrective actions, including strengthening the capacity of accounting officers, enforcing tax laws more strictly, and enhancing oversight of MDAs’ financial practices. The report also urges the FIRS to take action on the unrecovered liabilities.

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