Sanni Onogu, Abuja
THE Senate on Tuesday directed its Committee on Banking, Insurance and other Financial Institutions to investigate the alleged failure of banks to remit Withholding Tax to Federal and state governments.
The resolution of the upper chamber followed a motion, titled: “Digitisation/Automation of collection and remittance of Withholding Tax on bank deposits and dividends payments for enhanced State Government Internally Generated Revenue (IGR)” sponsored by the senator representing Anambra Central, Uche Ekwunife.
In her lead debate, Ekwunife said it had been discovered that the Central Security and Clearing System (CSCS) and banks in Nigeria do not remit Withholding Tax on bank deposits and dividends to state governments as and when due.
She added: “The current practice is that both the banks and the Central Security Clearing System remit to state governments any amount they desire, as it is difficult for the states to reconcile what amounts should be credited to them.
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“Remittances without recourse to details is capable of and already eroding the revenue due to the state governments.”
Ekwunife noted that the leakages on remittance of Withholding Tax could be addressed by using modern tax solutions and information technology.
She said it was necessary to take proactive measures to ensure that Withholding Tax due to government is remitted for enhanced revenue.
The senator added that the revenue would help in “meeting Federal Government’s drive and quest for increased and enhance IGR at all levels of government to meet the developmental needs of the nation”.
Most senators supported the motion.
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