A joint committee of the House of Representatives Committee on Finance, Banking and Currency has said that Nigeria lost about $30 billion between 2005 and 2019 to revenue leakages.
The leakages were from the activities of agencies and companies in banking, oil exploration, engineering, procurement, construction, installation, marine transportations, manufacturing, and telecommunications upon which the committee noted significant foreign exchange and revenue shortfall infractions against the country.
Sequel to this, the committee grilled the management of Citibank and Fidelity Bank over several of the alleged infractions, accusing them of compromise.
The chairman of House Committee on Finance and co-chairman of the Joint Committee, Hon. James Faleke, in his remarks at the commencement of the investigative hearing on the allegations, said the House at its sitting on March 5, 2020, resolved to conduct an investigative hearing on revenue leakages above $30 billion.
“The necessity and commencement of this investigation were as a result of growing problems in the financial management of all the God-given resources in our country, Nigeria, from our vast natural resources to the value added by these resources in the form of foreign exchange earnings and revenue generation, etc. into these investment environments and opportunities.
“Thus, this committee deemed it imperative to investigate revenue leakages and loopholes in the system, that have contributed to a loss of over $30 billion in annual federation tax revenue between 2005 and 2019.
“The investigation, therefore, was premised on the documents received from target agencies and companies in Banking, Oil Exploration, Engineering, Procurement, Construction, Installation, Marine Transportations, Manufacturing and Telecommunications upon which the Committee -noted significant foreign exchange and revenue shortfall infractions against the Federal Republic of Nigeria by these stakeholders.
“This places an imperative need to put an end to, or at best, minimise all attributable infractions that have been instruments in the hands of some stakeholders in bringing economic woes to this country and her people.
“During our documentation compilation and a further look at the economic woes caused the country by some companies, the committee has noted some major infractions which have multiplier effects on other infractions:
“Liftings of some crude oil and gas by oil exploration companies, that were not wholly and legally allocated to the consignors in JV, PSC and PSA exploration activities including those whose crude oil Certificates of Quantity were not signed by the Department of Petroleum Resources and terminal operators.
“Petroleum Profit Taxation at PPT rates ranging between 50 per cent of profit for PSC and PSA companies, and 85per cent of profit for JV companies.
“Inflow of foreign investments in the form of equity, foreign cash loans, equipment loans whose utilizations are majorly subject to tax, end up in transactions, foreign transfers that were at variance with the purpose of such inflows,” he said.
Interfacing with the representative of Citibank, Ngozi Omoke on the allegations, the committee accused the bank of not making remittances to the federation accounts from certain transactions.
Responding to the allegations, Mrs. Omoke said the bank conducted its activities within the Foreign Exchange Monitoring and Miscellaneous Provision Act.