About 77 oil and gas companies in Nigeria are indebted to the federal government to the tune of N2.659 trillion, the Nigeria Extractive Industries Transparency Initiative (NEITI) has said.
The debt arises from the failure to remit petroleum profit tax, company income tax, education tax, value-added tax, withholding tax, royalty and concession on rentals, the agency added.
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This was announced on Tuesday in Abuja by the NEITI Executive Secretary, Dr Orji Ogbonnaya Orji while briefing the media on the status of Extractive Industries Transparency Initiative (EITI) implementation in Nigeria during the agency’s mid-year briefing and presentation of its scorecard.
Orji explained that the total liabilities of the 77 companies covered by the NEITI process was as at the agencies’ 2019 independent audit report of the oil and gas sector.
According to Dr Orji, “The NEITI reports based on findings in its 2019 audit reports of the oil and gas sector show that oil and gas companies in Nigeria owe government about $6.48billion which equals about Two trillion, six hundred and fifty-nine billion Naira (N2.659 trn) at today’s official exchange rate of N410.35.
The NEITI boss pointed out that “A breakdown of the figures show that a total of $143.99million is owed as petroleum profit taxes, $1.089billion as company income taxes and $201.69Million as education tax.
“Others include $18.46Million and £972Thousand as Value Added Tax, $23.91million and £997Thousand as Withholding Tax, $4.357billion as royalty oil, $292.44Million as royalty gas, while $270.187Million and $41.86Million were unremitted gas flare penalties and concession rentals respectively.”
Orji stated that the disclosure is important and timely in view of the government’s current search for revenues to address citizens’ demand for steady power, access to good roads, quality education, fight insurgency and creation of job opportunities for the country’s teeming youths.
A comparative analysis of what this huge sum of N2.65trn can contribute to economic development shows that it could have covered the entire capital budget of the federal government in 2020 or even used to service the federal government’s debt of $2.68billion in 2020.