Tax defaulting companies to face criminal prosecution

The Lagos State Government on Tuesday warned that any multinational that failed to remit its tax to the state would, henceforth, face criminal prosecution.The state’s Solicitor General, Mr Lawal Pedro, gave the warning in an interview with newsmen in Ikeja.

He said the criminal prosecution option followed delays being experienced by the government in getting big firms to pay tax through civil suits.

``We wanted to be civil about the issue of tax evasion in Lagos in the past years and that is why we have been taking them to civil courts to reclaim the money.

``We have now seen that even when judgement is obtained in our favour for the defaulters to pay the money, they will take us to the Appeal Court and even to the Supreme Court.

``The state government has resolved that, henceforth, we will not only be focusing on civil action against tax defaulters, but we will also use criminal prosecution," Pedro said.

He said it was a criminal offence, under the Income Tax Act of the Federation, for companies and individuals not to pay tax.The solicitor-general lamented what he called the slow  judicial process in the country, adding that the issue of taxation was being treated with levity.

Pedro recalled that Justice R.I.B Adebiyi of an Ikeja High Court had on March 7, 2008, delivered judgement in favour of Lagos State Government against Shell Petroleum Development Company Nigeria Ltd (SPDC).

The judge ordered SPDC to pay N138.7 million-- being under deduction and remittance of taxes due to the government under Pay As You Earn and Withholding Tax Scheme for 1999, 2000 and 2001.

SPDC filed an appeal against the judgement at the Appeal Court and paid the judgement sum to the Chief Registrar of the High Court of Lagos State, pending the determination of the appeal,’’ he stressed.

Pedro said the case was still being heard at the court four years after the judgement was delivered, adding: 

such monies could have been used for some development purposes’’.

He advised companies to forward their complaints to the tax office or seek legal redress.When you have a genuine complaint, this will be properly looked into.

But for anyone to refuse to pay tax is a criminal offence and we intend to prosecute offenders."

Source:businessdayonline

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Nigeria to review BASA agreement with UK

Stella Oduah, Minister of Aviation, has called for a review of the Bilateral Air Service Agreement (BASA) between Nigeria and the United Kingdom.

A Bilateral Air Service Agreement (BASA) is an agreement signed by two nations to allow international commercial air transport services between their territories.

She made the call on Monday in Abuja at the ongoing public hearing by the Senate Committee on Aviation looking into the “violation of aviation laws and practices by foreign airlines in Nigeria.”

Oduah told the committee that she called for a review of the agreement after realising that British Airways (B.A) and Virgin Atlantic had defaulted in the agreement.

She said that available analysis and data showed that many destinations much farther than Nigeria “command less fares regardless of whether it is first, business or economy classes.

“Upon becoming aware of this apparent and unjustified disparity, I directed the relevant agency, the NCAA, under my ministry to analyse the market and provide information on the veracity or otherwise of this rather apparent difference.

“Nigeria supports profitable operations when the profits are reasonable but rejects exploitation and unreasonable excessive profiteering by exploiting her people.

“We are still on this issue and your voice from the Senate is welcome.”

Earlier, the chairman of the committee, Hope Uzodinma (PDP-Imo), had sought clarifications on what the BASA agreement stipulated, in order to know if any country defaulted and the penalty.

Uzodinma then directed that the review be made available to the committee within the next 14 days.

The British Airways country manager for Nigeria, Kolawale Olayinka, told the committee that airfares could only reduce in Nigeria if more airlines were allowed into the country.

“Prices on airfares can come down in Nigeria only if there is enough supply. Demand is high but supply is low in Nigeria unlike in the other countries.

“So increase supply and the prices will tumble down. Open up the skies let more airlines come into Nigeria and the prices will crash tomorrow.”

According to Olayinka, other factors responsible for high fares in Nigeria include landing and parking fees as well as the difference in the environment where the airlines operate.

The committee was, however, not satisfied with his explanation while Olayinka said he could not divulge any further information publicly since his competitors were also at the hearing.

Olayinka, however, pledged to make available to the committee on Tuesday a detailed presentation in writing which would answer all questions raised by the members.

Meanwhile, the Federal Government in its bid to reposition the aviation sector to contribute its quota to the growth of the economy has unveiled a master plan and implementation framework that will guarantee safe, secure, profitable and self-sustaining world class industry.

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How to invest in oil palm production

Oil palm is native to West Africa. Nigeria used to be the world’s largest producer of oil palm before the crude oil boom era. Malaysia has now taken the leading position.  Oil palm plantation and allied industries is now the main stay of Malaysian economy. Malaysia came to Nigeria in the 70s to obtain oil palm seeds and seedlings.

Oil palm can be used in various ways; the leaves are used in making brooms and as roofing materials (in the rural areas). The bark of the fond can be peeled and woven into baskets.

The main trunk can be split like sawn timbers and used as part of building materials. Palm wine can be obtained from oil palm, red palm oil is readily obtainable from the fresh fruit bunches. When the fruit is processed the residue obtained can be used as fuel (for cooking and fertilizer to improve soil nutrient).  Red palm oil is used in cooking, making soap, candle and margarine. Palm kernel oil can be extracted from the nut.

The residue obtainable in the process of palm kernel oil extraction otherwise called palm kernel cake is used as livestock feed. Palm kernel oil is used in vegetable oil and soap making.  Palm Kernel shells are also useful as energy source and industrial raw materials such as mosquito coils.

The uses to which oil palm can be made seem non exhaustive. This clearly indicates that investment made in the establishment of oil palm plantation is nothing but a wise one. The market is guaranteed for all the products of oil palm plantation in this era of global food crisis.

Technical information

To establish oil palm plantation, it involves getting a good site where rich, well drained acidic soils are abundant. The soil should have adequate quantities of potassium, magnesium and nitrogen. Soil tests should therefore be carried out to determine the nutrient status of the land.

It is usually better to use the early maturing variety called tenera, which bears fruits as from the fourth year.

Other requirements include seedlings procurement; this can be obtained from reputable nurseries. Prospective investors must engage the services of Agricultural experts in the course of establishing this project.

Other cultural practices are planting, regular weeding, pruning and fertilizer application. Serious minded investors will be guided accordingly in the implementation of this project.

Income analysis

A matured plantation will start to give investor five 5 tons per hectare of red palm oil annually from the fourth year per hectare. 100 metric tons of oil can be obtained annually from 20 hectare plantation. A ton of red palm oil is a minimum of N150,000. Gross revenue of N15 million is obtained from red palm oil.

We can also get three metric tons of palm kernel per hectare. This gives us 60 tons from 20 hectares. This translates to annual income of N4.2 million. Total income realisable is about N19.2 million while the annual operating expense is put at N5.8 million.

This leaves us with net income N13.4 million annually for the investor for the rest of his/her live. There are still other sources of income such as palm fronds and palm kernel shells. Serious minded investors can be assisted in the realisation of this worth while investment.
source:businessdayonline

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BA’s fuel efficiency drive saves over £20m

In its bid to reduce emissions and cut fuel bills, United Kingdom mega carrier, British Airways (BA), has introduced a fuel efficiency drive that will in turn help the environment.

The airline, which opened an online suggestion box, got over 200 ideas submitted by pilots, cabin crew, engineers and ground staff as to how the airline could make further progress.

Some of the more unusual suggestions include replacing glass with plastic wine bottles, reducing the amount of water carried in aircraft water tanks, and perhaps most unusually, the de-scaling of toilet pipes on the Boeing 747 and 777 fleets.

Not only did this save some £600,000 as a result of reduced weight, it also improved the performance of the toilets. The airline has also employed more conventional methods such as reducing the use of auxiliary power units, single engine taxiing and performance improvement packages on more than 40 Boeing 777 aircraft.

In total, the savings were worth over £20 million. Jonathan Counsell, head of environment at British Airways, said, “This really has been a team effort. It goes to show that small changes here and there can add up to significant savings.

Not only does this help us to reduce our environmental impact, it also saves us money.” British Airways is already working on more projects to save fuel in 2012, including the use of new, lightweight catering trolleys, headsets and cargo containers.

The airline has also extended a trial of tripleO, a special paint coating that improves aerodynamics and leads to greater fuel efficiency. A Boeing 777 is to be coated, following a successful trial of a smaller Airbus A318. British Airways said it was committed to reducing net carbon emissions by 50 percent by 2050.

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Naira appreciates for second day on dollar sales

Nigeria’s naira appreciated for a second day against the dollar on bets month-end dollar sales by oil companies and increased oil exports by sub-Saharan Africa’s second largest economy will support the local currency.

The currency of Africa’s biggest oil producer strengthened 0.1 percent to 157.53 per dollar as of 11:30 a.m. in Lagos, the commercial capital. The oil industry, which is the second major supplier of foreign exchange after the central bank, often sells dollars to lenders around the month-end period to meet domestic spending needs.

Nigeria plans to boost crude exports in May to a 10-month high, by exporting 69.3 million barrels, or 2.24 million barrels a day, the most since July. That compares with 78 cargoes totaling 2.22 million barrels a day for April, according to loading plans obtained by Bloomberg News. “Month-end implies naira strength as energy firms increase their offerings of U.S. dollars on theinterbank market,” Celeste Fauconnier and Nema Ramkhelawan-Bhana, Africa analysts at Rand Merchant Bank in Johannesburg, wrote in an e-mailed note today.

“The increase in export volume should provide some cushion to the Nigerian foreign exchange reserve in the face of global oil demand” and provide support for the naira, Lagos-based Cowry Assets Management Ltd. analysts led by Edgar Ebinum, wrote in an e-mailed note today. Foreign reserves have risen 7.9 percent this year to $35.6 billion as of March 29, the central bank published on its website today.

The nation’s bonny light crude is trading at more than $50 a barrel above the $72 a barrel incorporated into Nigeria’s 2012 budget, according to the bank. The yield on Nigeria’s $500 million of dollar bonds due 2021 fell 10 basis points to 5.288 percent.

Borrowing costs of domestic bonds due 2015 fell 21 basis points to 15.25 percent, according to the Financial Markets Dealers Association website.

Source:Businessdayonline

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