Tax irregularities amounting to N14.33 billion across more than 30 Ministries, Departments, and Agencies (MDAs) has been revealed by a report by the by the Auditor-General of the Federation.
The findings, presented in the Auditor-General’s Annual Report on Non-Compliance and Internal Control Weaknesses, expose significant lapses in tax deductions, remittances, and adherence to financial regulations between 2020 and 2021.
The report highlighted that six MDAs accounted for N129.34 million in under-deductions of taxes. Paragraphs 234 and 235 of the Financial Regulations (2009) require accounting officers to ensure timely deduction and remittance of applicable taxes, such as Value Added Tax and Withholding Tax, to the Federal Inland Revenue Service (FIRS). However, the audit uncovered widespread violations of these provisions.
The Federal Road Safety Corps (FRSC), Abuja, was identified as the highest offender, with an under-deduction of N90.57 million, while the Federal Ministry of Labour and Employment, Abuja, recorded the smallest shortfall of N623,162.80.
Other agencies implicated include the Federal Polytechnic Bida, Nigerian Security Printing and Minting Company (NSPM) Plc, National Water Resources Institute, and the Council for the Regulation of Freight Forwarding in Nigeria.
Additionally, the audit revealed non-deductions of taxes amounting to N2.64 billion across 21 MDAs. These agencies failed to deduct taxes from payments to contractors and beneficiaries, breaching financial regulations. The NSPM, Abuja, led in this category with a discrepancy of N1.01 billion, while the Federal Medical Centre, Ebute Meta, had the smallest amount at N617,427.66.
The most significant irregularity involved the non-remittance of taxes totaling N11.56 billion by 11 MDAs. The NSPM, Abuja, again emerged as the largest defaulter, with N10.39 billion in unremitted taxes, while the Federal Medical Centre, Katsina, recorded the least amount at N1.37 million.
Further, the report uncovered N69.93 billion in unrecovered tax liabilities across 26 Federal Inland Revenue Service outstations nationwide. The outstations in Akwa Ibom, Cross River, and Bayelsa States accounted for the highest combined unrecovered amount of N26.32 billion, while the FIRS office in Gwagwalada, Abuja, recorded the least at N4.18 million.
The Auditor-General’s report raises significant concerns over weak internal controls and widespread non-compliance with financial regulations among government agencies. These lapses are said to undermine revenue collection and public accountability.
The report recommends immediate corrective actions, including capacity building for accounting officers, stricter enforcement of tax laws, enhanced oversight of financial practices in MDAs, and recovery of outstanding amounts by the FIRS to prevent further revenue losses.
