Why Nigeria Loses Over $2.9bn Per Year From Tax Breaks for Multinational Corporations – CISLAC Executive

According to the Civil Society Legislative Advocacy Centre (CISLAC), Nigeria loses $2.9 billion per year as a result of tax breaks granted to multinational corporations.

Auwal Musa Rafsanjani, Executive Director of CISLAC, stated at the Pan African Conference on Combating Illicit Financial Flows (IFFs) to Bridge the Widening Inequality Gap in Abuja that Africa has lost up to $1 trillion due to IFFs, with US$50 billion lost annually over the last 50 years.

Rafsanjani emphasized that, despite the huge loss from tax waivers, the government increased value-added taxes (VAT), which disproportionately impacted the poor, from 5% to 7.5%, adding that crime and tax evasion were growing concerns that reduced government revenue for financing long-term development.
“The International Monetary Fund and World Bank have all expressed concerns about the likely sharp increase in inequality and poverty as a result of the pandemic,” he said.

“According to estimates, 42.1 percent of the sub-region will be pushed into extreme poverty.”

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“Worse, the World Bank indicated that reversing the poverty increase could take more than a decade, effectively erasing all hope of countries meeting their national development plan targets to reduce poverty and inequality by 2030.”

“On the other hand, the region’s wealthiest people fare differently, with the three wealthiest men in the region, all of whom are based in Nigeria, seeing their wealth grow from US$16.8 billion in March 2020 to US$23.2 billion by July 2021.”

The Executive Director of CISLAC also revealed that the amount lost to IFFs in Africa is roughly equivalent to all of Africa’s official development assistance (ODA) received during the same time period, though he cautioned that the estimates may fall short of reality due to inaccurate data for all African countries.
In his remarks, Garba Abubakar, the Registrar-General of the Corporate Affairs Commission (CAC), stated that the Pandora Papers revelation demonstrated that poverty, inequality, a lack of infrastructure, and good governance were not adequately addressed.

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“Public Beneficial Ownership Registers are important tools for advancing the fight against corruption, tax evasion, asset shielding, and illicit financial flows, among other things.”

“Registers of beneficial owners, on the other hand, are assisting in no small measure to expose corruption orchestrated by ultimate beneficial owners who ore individuals who ultimately own, control, or benefit from registered corporate entities,” he said.