Nyesom Wike, Minister of the Federal Capital Territory (FCT), has ordered that all commercial transactions in Abuja must first demand and be verified by a Tax Clearance Certificate (TCC).
At a news conference yesterday in Abuja, Chinedum Elechi, the mandate secretary for the Economic Planning, Revenue Generation, and Public Private Partnership Secretariat of the Federal Capital Territory Administration (FCTA), said this:
He said, “I am here today to announce that the FCT minister 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.
“Both sections provide for demand and verification of TCC by the Federal Government ministries, departments and agencies (MDAs); commercial banks; and FCT secretariats, departments and agencies (SDAs).
“Implementation of these laws is intended to ensure all eligible taxpayers in the FCT comply with their tax obligations.
“This will ensure the FCT administration gets the required resources it needs to provide essential services to FCT residents.”
According to him, TCC must be requested by MDAs or commercial banks when conducting business with any person as defined by law under Section 85 of the Personal Income Tax Act of 2011.
Elechi pointed out that the TCC will include the three most recent years that came right before the year of assessment.
He added that before doing any transactions, MDAs or commercial banks must have the issuing tax authorities confirm the validity of the tax clearance certificate.
He said: “Section 85 of PITA also provides that for purposes of obtaining a TCC, any person who gives incorrect information or obtains a TCC through misrepresentation, forgery or falsification is guilty of an offense.
“Such a person is liable on conviction to a fine of N50,000 plus twice the tax payable by him or her, or to imprisonment for three years or to both such fine and imprisonment.
“Similarly, a person, be it a government organisation or corporate entity to whom Section 85 applies, who fails to demand, or verify a TCC, is guilty of an offence and is liable on conviction to a fine of N5 million, or to imprisonment for three years or both fine and imprisonment.”
The mandate secretary further stated that TCC was needed for conducting any business in the FCT under Section 31 of the FCT-IRS Act. He named a few of the transactions that call for a TCC, including real estate transfers, certificates of occupancy, contractor registration, contract awards, and construction design approval.
Others include government licenses or permits, company licenses or permit applications, FCTA housing loans, motor vehicle registrations, distributorship registrations, and confirmations of membership on any public boards.
Other relevant transactions include, among others, the application for market stalls, the registration of a limited partnership, and the appointment or election to public office.
“Consequently, all MDAs, commercial banks and SDAs were required to demand and verify TCC from all taxpayers before providing them with any services.
“On behalf of the FCT administration, we urge all individuals, corporations, corporation-soles, trustees, or executors to ensure they pay their taxes, obtain their TCCs and present them whenever required.
“Taxes are essential to the foundation of any government, and it is important that everyone pays their fair share as a civic duty and responsibility,” he said.
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