Alleged N424.3m tax evasion: Contractor urges FIRS to investigate oil firm

The Federal Inland Revenue Services (FIRS) has been charged to
investigate an allegation of tax evasion by an oil company,
Heritage Energy Operational Services Limited (HEOSL), running into
several millions of naira.

Raising an alarm in a petition addressed to the Chairman of the
FIRS, a service-provider company to HEOSL, Eraskorp Nigeria
Limited, alleged that the oil company had been deducting
with-holding taxes meant for the company since 2017 to 2019, but
had failed to remit same to the FIRS.

According to the petition, signed by a Director in Eraskorp,
Richard Ogugu, a total sum of N169,986,341.55 and USD $706,680.00
had been deducted by HEOSL between 20th Jan, 2018 and 27th Mar,
2019 from the company’s paid, it however added that the oil company
had since refused make prove of payments to the FIRS available to
it.

Eraskorp, according to the petition, did a facility protection
contract for HEOSL between January 2018 and March 2019, on the OML
30 facilities in Delta state, adding that it complied with
statutory demands that it remits it’s with-holding taxes, which it
did by allowing the oil company to deduct the taxes at source, with
the understanding that same would be remitted to the federal
government’s coffers through the FIRS.

It, however lamented that the failure of HEOSL to remit the
taxes it had deduct from its payments at source, had impeded its
chances of obtaining its tax clearance certificate, which is making
it difficult for it to continue in business.

“Eraskorp Nigeria Limited had a facilities protection contract
with HEOSL covering OML 30 between 2017 and 2019. In line with the
statutory requirement that withholding tax is deducted at source,
HEOSL deducted same from all payments made to us under the
contract, but failed to remit same on our behalf to the Federal
Inland Revenue Service (FIRS).

“It might interest you to note that the outstanding withholding
taxes of N169, 986,341.55 (One Hundred and Sixty Nine Million, Nine
Hundred and Eighty Six Thousand, Three Hundred and Forty One Naira,
Fifty Five Kobo) and USD $706,680.00 (Seven Hundred and Six
Thousand, Six Hundred and Eighty Dollars) deducted from our paid
invoices between 20th Jan, 2018 and 27th Mar, 2019 are yet to be
remitted on our behalf to FIRS by HEOSL.

“We have made several demands that they furnish us with the
evidence of payments in our favour but all our efforts have been
unfruitful. Please see attached the schedule of invoices upon which
the deductions were made.

“Due to the failure of HEOSL to remit the said withholding taxes
on our behalf, we have been unable to obtain our current tax
clearance certificate which is a required document to conduct our
business.

“In view of the foregoing, we urge you to most respectfully
investigate our claims as contained in this petition as a matter of
urgency, as the non-payment has caused us severe hardship,
including our inability to participate on tenders. We thank you for
your kind attention and do accept the assurance of our highest
regards.

However, responding to the allegation in a telephone chat with
The Nation on Monday admitted that the company had issues with its
with-holding tax records, but also noted that the matter was
already being sorted out with revenue authorities, adding that an
agreeable term had been reached with revenue authorities to defray
the alleged anomaly.

“I haven’t got all the facts to hand and I probably need may be
about fifteen minutes to speak our finance person to get the
latest, but what I can tell you is that there were some issues
raised about our with-holding tax by the revenue so we had to go
sort that out with the EFCC and our tax consultants and we entered
a payment plan to clear the with-holding tax over a period of
months.

“We captured a plan that is acceptable with the authorities. The
settlement has been agreed with the revenue and it can be
discharged over an agreed period of time,” he said.