FG offers amnesty, immunity for defaulters of undeclared Offshore Assets – Independent Observers

FG offers amnesty, immunity for defaulters of undeclared Offshore Assets

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By Kunle Adedoyin

The Federal Government has announced the approval of tax amnesty and permanent waiver of criminal prosecution for owners of offshore assets who are willing to voluntarily declare them.

Mr. Abubakar Malami, SAN, the Attorney General of the Federation and Minister of Justice, who made the disclosure, at the unveiling ceremony of the Voluntary Offshore Assets Regularization Scheme (VOARS) in Abuja, said the immunity package would shield the owners from tax offences, penalties and interests concerning such declared offshore assets.

Malami said the VOARS was a scheme that was initiated by the Swiss Consortium with a view to facilitating the regularization of offshore assets owned by Nigerians.

“It is expected that those funds owned by Nigerians that are not in the system will be voluntarily declared by the owners. Please note further that when funds are voluntarily declared by the owners, the Federal Government will deduct 35 per cent recoveries, while 2 ½ per cent will be charged as administrative fees for the purpose of assessing the funds while 63 per cent will be registered in the system to become taxable in Nigeria.

“The Infrastructure Fund will serve as a proposed investment facility, where the Federal Government will have minimal investment, with the matching investments from banks and prospective international investors as well as Nigerians, holders of the 63 per cent who are expected to invest in this fund with the view of financing Nigerians infrastructure and bridging the deficiency in attracting Foreign Direct Investment.

“I wish to solicit the cooperation of all Nigerians to key into this initiative. Just like the Voluntary Assets and Income Declaration Scheme, VAIDS, the rationale for the VOARS is to provide an opportunity for taxpayers or amnesty for tax defaulters to voluntary declare their offshore assets and income from sources outside Nigeria relating to the preceding 30 years of assessment and in return, obtain some benefits like: Permanent waiver of criminal prosecution for tax offences and offences related to the offshore assets, penalties and interests concerning such declared offshore assets; Immunity from tax audit of the declared and regularized offshore assets; waiver of interest and penalties on the declared and regularized offshore assets; receive from Federal Government an Offshore Assets Regularization Compliance Certificate on the declared and regularised offshore assets; and be free to use or invest their duly regularized residual offshore assets in any manner in Nigeria or overseas, and be subject only to annual tax to Federal Government on the income earned on such residual offshore assets,” he said.

 Malami explained that the Executive Order 8 on the Voluntary Offshore Assets Regularization Scheme signed by President Muhammadu Buhari on October 8, 2018 served as legal basis for the Swiss Consortium to approach third party holders of the fund with the view of assessing information of the owners.

He said the third party include banks, estate managers, auditors, accountants, amongst others, adding that his office is collaborating with the Ministry of Finance, Accountant General of the Federation, the Federal Inland Revenue Service, Infrastructure Concession Regulatory Commission, Nigeria Intelligence Agency, Nigeria Sovereign Investment Authority, Central Bank of Nigeria and Debt Management Office, DMO, to develop a road map for implementation of the Executive Order 8, as well as mechanism for taxation on Funds to be declared by Nigerians as offshore assets.

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