Wike Orders Strict Enforcement Of FCT Internal Revenue Law

In a bid to improve the revenue base of the Federal Capital Territory (FCT), the FCT minister, Nyesom Wike, has ordered strict implementation of the Personal Income Tax and the FCT Internal Revenue Service Acts 2015.
It was reported that the minister, on October 4, 2023, in a memo directed all Ministries, Departments, and Agencies MDAs, Commercial banks, as well as FCT Secretariats, Departments, and Agencies SDAs to ensure strict compliance with the laws particularly Section 85 of the Personal Income Tax Act (PITA) and Section 31 of the FCT Internal Revenue Service Act 2015.
The FCTA mandate secretary of the Economic Planning, Revenue Generation, and Public Private Secretariat, Hon. Chinedum Elechi, who made this known at a press conference in Abuja disclosed that Wike has approved the implementation of Section 85 of the Personal Income Tax Act (PITA) and Section 31 of the FCT Internal Revenue Service Act, 2015.
In line with this, all Ministries, Departments and Agencies (MDAs) Commercial banks; and FCT Secretariats, Departments and Agencies (SDAs) have been enjoined to ensure strict compliance with the laws particularly section 85 of the Personal Income Tax Act (PITA) and Section 31 of the FCT Internal Revenue Service Act 2015.
Both sections provide for demand and verification of Tax Clearance Certificates (TCC), by Federal Government Ministries, Departments, Agencies, Commercial Banks, and FCT Secretariats, Departments, and Agencies before any transactions are allowed.
Penalties ranging from N1000,000.00 fine to three years jail terms as provided in the Acts await defaulters as the new revenue generation exercise takes off.
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Elechi warned that as per Section 85 of the PITA, anyone who provided false information or obtained a TCC through forgery or falsification was liable to a fine of N50,000 or a three-year jail term or both upon conviction.
He added that a government entity or organization who failed to verify a TCC was liable to a fine of N5,000,000 or a three-year, jail term or both, upon conviction.
The Secretary also explained that Section 31 of the FCT-IRS Act provided that all SDAs, corporate bodies, or any person empowered by law, shall demand a TCC from any person or enterprises for the last three years “preceding the current year of assessment as a precondition for transacting any business in the FCT,” he said.
He explained that transactions include a Certificate of Occupancy, award of contracts, approval of building plans, application for FCTA loan for housing, business, or any other purpose, and registration of motor vehicles, among others.
Elechi appealed to residents to pay their taxes and obtain their TCCs, noting that “Taxes are essential to the foundation of any government, and it is important that everyone pays their fair share. Payment of tax is a civic duty and responsibility.
Implementation of these laws is intended to ensure that all eligible taxpayers in the FCT comply with their tax obligations”.
In the memo signed by Wike, the minister said; “The Federal Capital Territory Administration (FCTA) has observed with dismay, lack of implementation and adherence to the provisions of section 85 of Personal Income Tax Act (PITA), 2011 (as Amended) and Section 31 of the Federal Capital Territory Internal Revenue Service Act, 2015 that provide for the demand and verification of Tax Clearance Certificates TCC from residents of the FCT before rendering of services or performance of transactions.
“It is pertinent to note that both the Personal Income Tax Act (PITA) 2011 (as amended) and the Federal Capital Territory Internal Revenue Service Act, 2015 provide that Ministries, Departments and Agencies (MDAs), Commercial Banks, Secretariats, Departments & Agencies (SDAs) of the Federal Capital Territory Administration (FCTA) as well as Area Councils, corporate bodies, and statutory authorities among others must demand and verify TCC from residents before rendering of services or performing any transaction.
“For the avoidance of doubt, Section 31(5) of the Federal Capital Territory Internal Revenue Act 2015 provides that “A department, agency or official of the FCTA, any Area Council official, any corporate body, statutory authority or person empowered in that regard by this Act or any other law shall demand a tax clearance certificate for the three (3) years immediately preceding the current year of assessment as a pre-condition to transacting any business including but not limited to…” and shall verify the genuineness by referring same to the issuing tax authority.
“Consequently, all MDAS, SDAs, commercial banks, corporate and statutory organizations operating within the FCT are mandated to forthwith enforce the provisions of the extant laws by demanding from individuals, business names/enterprises, and organizations current Tax Clearance Certificates for the last three (3) years before carrying out any business transaction and verifying with the FCT-Internal Revenue Service for those transactions listed in the schedule attached to this Circular as ANNEX 1.
“Any official of MDAs, SDAs, officials of the FCTA, Area Council officials, corporate body, statutory Authority or Commercial Banks who violates and fails to comply with the provision, is guilty of an offence and is liable on conviction to a fine of N5,000,000.00 or to imprisonment for 3 years or both fine and imprisonment as provided for by section 85 (9) of PITA, 2011 (as amended).