THE CHARTERED INSTITUTE OF TAXATION OF NIGERIA€¦ · 3.2 MATTERS ARISING All matters arising had...

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THE CHARTERED INSTITUTE OF TAXATION OF NIGERIA

CHARTERED BY ACT NO. 76 OF 1992

MINUTES OF THE 23rd ANNUAL GENERAL MEETING

OF THE INSTITUTE

HELD AT

THE BANQUET HALL, TAX PROFESSIONALS’ HOUSE, PLOT 16, OTUNBA JOBI

FELE WAY,

CENTRAL BUSINESS DISTRICT, ALAUSA, IKEJA, LAGOS STATE

ON

WEDNESDAY, 3rd JUNE, 2015

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1.0. ATTENDANCE

1.1 PRESENT

1. Chief M. A. C. Dike, FCTI - President/Chairman of Council

2. Dr. (Mrs.) O.A. Somorin, FCTI - Vice President

3. Chief C. I. Ede, FCTI - Deputy Vice

President

4. Mr. A. I. Adedayo, FCTI -

Honorary Treasurer

5. Ms. G. O. Simplice, FCTI - Council

Member

6. Chief A. O. Otitoju, FCTI - Council

Member

7. Mr. G. A. Da-Silva, FCTI - Council

Member

8. Mrs. R. A. Olumegbon, FCTI - Council

Member

9. Mr. S. O. Agbeluyi, FCTI - Council

Member

10. Mrs. J. Okoror, FCTI - Council

Member

11. Mr. W.E. Arome, FCTI - Council

Member

12. Alhaji A. M. Gwaram, FCTI - Council

Member

13. Maj. Gen. (Rtd.) A. Bako, FCTI -

Council Member

14. Mrs. E. Ebilah, FCTI - Council

Member

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15. Dr. F. Omaka, FCTI - Council

Member

16. Mrs. R. Udochukwu, ACTI - Council

Member

17. Mr. G. O. Fasoto, FCTI - Past President

18. Prince R. A. Quadri, FCTI - Past

President

19. Chief J.F.S. Jegede, FCTI -

Immediate Past President

20. Mr. A. Awogbade, FCTI -

Registrar/Chief Executive.

Apart from the President, the Council members and the Past Presidents, there

were additional two hundred and forty nine (249) members present at the Annual

General Meeting.

2.0 COMMENCEMENT

The meeting commenced at 12.07p.m. with the National Anthem and the

second stanza of the National Anthem said as opening prayers for the

meeting. The Assistant Director of Corporate Services, Mr. G. Bilewu,

introduced members on the high table and Council Members present after

which he handed the microphone over to the President for commencement

of proceedings.

The President, Chief M. A. C Dike (m/n 941) welcomed members to the 23rd

Annual General Meeting (AGM) of the Institute and in particular, gave

recognition to Council Members, Past Presidents, Committee Members, the

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External Auditors, Legal Advisers, Chairmen of District Societies and Chairmen

of Boards of Internal Revenue present.

The President craved the indulgence of all members present, at this juncture,

to observe a minute’s silence in honour of members that had passed to glory

since the last general meeting.

.

He thereafter called on the Registrar/Chief Executive, Mr. A. Awogbade (m/n

6837), to confirm if a quorum had been formed for the commencement of

the 23rd Annual General Meeting (AGM) of The Chartered Institute of

Taxation of Nigeria (CITN) to which the Registrar/Chief Executive answered in

the affirmative.

2.1 READING AND ADOPTION OF NOTICE OF 23rd ANNUAL GENERAL MEETING

The President called on the Registrar/Chief Executive to present the notice

of the meeting for adoption. The Registrar/Chief Executive, Mr. A.

Awogbade (m/n 6837) presented the agenda of the meeting as follows:

ORDINARY BUSINESS:

i. To read and adopt the Minutes of the 22nd Annual General Meeting held

on Wednesday, 4th June, 2014;

ii. To lay before the Meeting the Report of Council;

iii. To adopt the Financial Statements for the year ended 31st December

2014 and the Report of the Auditors thereon;

iv. To appoint Auditors and authorize Council to fix their remuneration;

v. To elect members of Council;

vi. To consider and adopt the private motion submitted by Professor Uche

Jack-Osimiri, (Membership Number 540) in respect of the tenure of office

of the Deputy Vice President;

vii. To consider any other business.

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The motion for adoption of the notice of meeting was moved by S. Fagbulu

(m/n 9785) and seconded by Princess E. Ebilah (m/n 8223) while members

were requested to indicate their support of the motion by show of hands with

no counter indication against the notice of meeting.

3.1 READING AND ADOPTION OF THE MINUTES OF THE 22nd AGM

The minutes of the 22nd AGM were taken as read, having been placed on

the website for quite a while so that members could have access to them

earlier.

Motion for the adoption of the minutes was moved by Alh. A. Gwaram (m/n

7880) and seconded by Mr. L. A. Shonubi (m/n 1614) subject to the following

amendments:

At page 12, change from “Mr. T. I. Imoh (m/n 8571” to “Mr. I. I. Thompson

(m/n 8571

At page 12, change from “Mr. B. E. Akinsanmi (m/n 565)” to “Dr. E.A.

Babafemi (m/n 565)

3.2 MATTERS ARISING

All matters arising had been dealt with within the last one year while events

had overtaken others.

4.0 BUSINESS OF THE DAY

4.1.0 PRESIDENT’S STATEMENT

4.1.1 MEMBERSHIP STRENGTH

The President informed members that the membership strength had

continued to increase appreciably. Thus, through this phenomenal growth,

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the leadership of the Institute had been able to continually create a strong

manpower base needed to professionally-drive the tax system in Nigeria.

4.1.2 Economy

The President noted the fall in revenue by crude oil, in the midst of a host of

so many other mineral resources the country is blessed with. He recalled the

review of government’s Medium Term Expenditure Framework (MTEF) and

Fiscal Strategy Paper (FSP) for 2015 – 2017 and spiraling foreign exchange

rate from N171 per United States Dollars for most part of 2014 to N222 per

United States Dollars at the Bureau De Change window as symptoms of these

worrisome developments. The thin government buffer for preserving the

economy was broached as well.

The Institute called on the government not to treat the matter of economic

diversification with levity any further and that government should provide the

enabling environment for businesses to flourish while it ramps up its tax

collection efforts.

He further noted the fiscal budget deficit gap that the current government

revenue effort revealed stating that at 12% revenue to Gross Domestic

Product, revenue to government translates to N9.72 Trillion in gross revenue

available for the three tiers of government while combined federal and state

budgets stood at N11.488 Trillion at 2013 budgetary levels. He stressed that

absence of internally generated revenue by constituent states would, no

doubt, leave governments no choice but to go borrowing to bridge the gap.

He called on government at all levels to commit, long term, to deal with their

revenue challenges with a view to turning the crude oil revenue debacle to

an economic renaissance.

4.1.3 Power Sector

The President noted the progress made in the power sector but regretted

that this had not translated to constant power supply in the immediate term.

Rather, It was almost as though the current power outage situation

appeared to pale, to insignificance, previous records of the longest outages

in the annals of the nation’s history as virtually every facet of life was being

affected by the protracted outage around the country.

He berated government’s response to the gas challenges used as feedstock

for the power plants for attainment of credible supply of power. He also

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carpeted government in the face of the challenges of gas networks in

power generating plants as well as the lacuna of a coherent gas pricing

policy required to guarantee steady supply of gas for the new private

owners for the sector.

Furthermore, he considered the consumption side of the power situation

noting its effect on business survival stating that businesses could not afford

to survive under generator budgets. He therefore called on the new

government of President Muhammadu Buhari, GCFR, to tackle the problem

head on at the inception of his administration as part of critical interventions

from government required to truly get the economy moving on the desired

growth trajectory.

4.1.4. Oil and Gas

The President noted the significant developments in that sector with the

advent of shale oil production and its revenue implications for the economy.

He recalled the Organisation for Petroleum Exporting Countries (OPEC)

report of October, 2014 which noted that US imports to the Gulf Coast had

touched six-year lows in months leading up to the report as domestic shale

production in the United States had reduced the need for foreign crude,

particularly from West Africa. OPEC stood by preferring to do nothing as

believing that prices would bottom out in the near term while member

nations such as Nigeria continued to grapple with this realization.

The President lamented the non-passage of the Petroleum Industry Bill noting

that significant investments to the sector had being put off due to the non-

passage of the bill. He recounted the benefits of passage of the bill and

called on the government to pass the bill without further delay. He also

called on the government to keep the process of passage of the bill open

so as not to go into the secretive and opaque manner in which businesses

are conducted in that sector.

He touched on the issue of the nation’s refineries wondering why the

country continues to import refined petroleum products that we are well

able to produce in Nigeria owing to the government’s lack of steely political

resolve to address the insufficiencies of local supply in the system. He equally

noted that Nigeria had no business with the import of petroleum products as

it turned economic reasoning on its head with implication for same on

scarce foreign exchange due to the regime of importation, among other

considerations. He called on the government to be proactive and

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assertively engage all towards ensuring that the refineries are fixed and

made to work optimally.

4.1.5 Security

He called on government to ensure that no part of the country was made

unconducive for personal dwelling and economic activity stating that the

economic space to grow and develop businesses should be just as

synergistic as it should remain calm for investment to thrive. He noted the

gains by the armed forces in the fight against terrorism in the North East

even though the continuous clamour for the return of the 219 Chibok girls

kidnapped from their school dormitories since April, 2014 blighted the fight

to date.

He called on the government not to spare anything to see to the return of

these girls in order to bring the nightmare to a closure for their family and

loved ones and also lift the veil of embarrassment the whole episode had

caused the nation.

He called on all to remain united and supportive of one strong and

indivisible country.

4.1.6. Banking Sector

The banking sector was reported to have continued enjoying its relatively

stable operating environment in the face of dwindling oil revenue. The

sector was noted as continuing in its show of strong support for the power

sector transformation.

The introduction of the scheme for small and medium scale businesses to

gain access to loans for business growth was acknowledged. The banking

system is noted as a catalyst for overall productivity in the economy with the

interplay of optimal interest and foreign exchange rates for boosting local

productivity. It is when this happens that a virile tax base could be birthed

and well able to contribute its fair share to economic growth and

development.

4.1.7 Education Sector

It was noted that the educational sector continued its recovery from its 2013

strikes which engulfed the tertiary institutions with the hope that never again

would such level of disaffection and disruption be experienced. Nations

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such as Japan were noted for nothing more than their knowledge economy

which had been overtaken by China as the 2nd largest economy in the

world. He pointed the nation in this direction in her quest to becoming one

of the first 20 economies in 2020.

4.1.8 TAXATION

The Institute noted the non-appointment of a substantive Executive

Chairman for the Federal Inland Revenue Service since the end of the

tenure of the last holder of that office, Mrs. Ifueko Omoigui Okauru on 5th

April, 2012. Although the office had since had two occupants, they were in

acting capacity. The Institute therefore called on the government to

appoint a substantive head for the Federal Inland Revenue Service without

any further delay while ensuring at the same time that such an appointee is

a bona fide member of the Chartered Institute of Taxation of Nigeria in

accordance with all enabling statutes.

The Institute also used the opportunity to put forward its proposals for

consideration by the incoming government which include:

4.1.9 Tax Amnesty

The Institute called for Tax Amnesty for non-compliant taxpayers. The

President underscored the benefit of having this programme in place and

proposed that taxpayers be categorized into 3 broad classes as follows for

the purpose of the tax amnesty:

i. Large taxpayers: This category of taxpayers would be asked to review

their compliance for the past 6 years and fully disclose and pay any

outstanding liabilities. Interest and penalties would be waived in full.

ii. Medium-size taxpayers: The taxpayers in this class would be asked to

do a similar assessment as the large taxpayers but limited to 3 years.

Also there would be full waiver on interest and penalties.

iii. Small and micro taxpayers: These taxpayers would only be required to

comply for one year without having to go back to past years. No

interest or penalty would be charged on any tax payable as a result of

the amnesty exercise.

4.1.10 National Tax Policy

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The need to implement the National Tax Policy which was introduced in

2010 was revisited. The new government was enjoined to set up an office to

focus on the implementation of the National Tax Policy (NTP) with

appropriate benchmarks for measuring its implementation. About 5 years

after the NTP was approved, the implementation had been haphazard and

inconsistent.

4.1.11 Tax Waivers and Incentives

Many of the incentives granted by government had not achieved

commensurate benefits for the economy. In some cases, they had been

abused by investors. Government was urged therefore to streamline tax

incentives especially pioneer status, import duty waivers and double dipping

for income exemption. Incentives were proposed based on sectors and

targeted at industries to ensure a level playing field.

Government was also urged to renegotiate existing tax treaties to limit tax

give-aways and negotiate new treaties as well so as to expand tax treaty

networks which was regarded as being too narrow given the country’s wide

trade and economic relations globally. The tax treaties in existence granted

reduced withholding tax rates of 7.5% on investment income compared to

10% without treaty advantage. Given that Nigeria was predominantly a net

importer of capital, it was therefore noted that the country was giving away

far too much than she was getting in return.

4.1.12 Tax Dispute Resolution

The President noted that it was very cumbersome and expensive to

challenge unfavourable assessments by tax authorities. He therefore

enjoined government to ensure faster and fairer resolution of tax disputes

adding that Judges should be trained in tax matters and also consult with

tax experts when resolving tax cases. Tax audits usually take up to 10 years

even without any appeal to the court. This should also be addressed and

the tax authority encouraged to adopt a risk-based approach to tax audit

and investigation.

4.1.13 Annual Budget and Fiscal Policy

The Institute called for annual fiscal policy statements in the annual budget.

This should be designed to achieve the Medium to Long Term Revenue and

Expenditure Framework of the government. There should be consistency in

the policies with sufficient time for businesses to prepare for changes.

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4.1.14 Multiple Taxation and Earmarked Taxes

With regards to multiple taxation and earmarked taxes, this should be

reduced to the barest minimum as these taxes make Nigeria uncompetitive

for investments and make the tax system extremely cumbersome. Too many

taxes were imposed by all the 3 levels of government regardless of questions

of their legality.

The Institute therefore welcomed the announcement that the Federal

Executive Council had approved a framework for the

rationalization/elimination of multiple taxation in the country and noted that

a bill would be prepared by the Federal Ministry of Justice for onward

transmission to the National Assembly.

4.1.15 Address Multiple Revenue Collection Agencies

The need to streamline tax collection by multiple revenue agencies and the

prevalence of this practice in increasing administration costs and hence

cost of collection also drew the Institutes’ attention. Different agencies

noted to be collecting revenue for government include the Nigeria

Investment Promotion Commission, Industrial Training Fund, Nigeria Social

Insurance Trust Fund, Nigerian Communications Commission etc. The

duplication of revenue collection mechanisms and associated costs was

noted to lead to multiple agencies carrying out audits of businesses which

was often confusing and uncoordinated. Multiple agencies also increased

the risk of leakages and non-remittance of revenue collection. The Federal

Inland Revenue Service (FIRS) was urged to be empowered to collect all

revenues on behalf of federal agencies and account for such revenues in

accordance with its enabling law and other relevant statutory regulations.

4.1.16 Expand Tax Base

Nigeria’s tax to pre-rebased GDP ratio was put at 12% while post-rebased

ratio was 8% (about 5% from oil and 3% from non-oil). This ratio was noted as

one of the lowest in the world compared to 23% in Ghana, 25% in South

Africa and 39% in Brazil to mention a few.

Government was urged to expand the tax base of the economy by bringing

more taxpayers into the tax net and this can be achieved through

collaboration among government agencies and other measures such as

whistle-blowing. For instance, it should not be possible to register a company

with the Corporate Affairs Commission without registering for taxes. There

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should also be focus on how to increase tax revenue through transfer pricing

implementation as well as effective taxation of emerging sectors such as

Nollywood, and informal sectors. It was also necessary to develop a tax

collection strategy for the informal sector as well as enforcement of tax

compliance by MDAs, civil servants and political office holders.

4.1.17 Improve Tax Authority Capacity

The critical need to improve the capacity of the tax authorities through

quality training, exchange programmes with developed countries as well as

recruitment of competent staff also received the attention of the President

in his statement. Instance was given of the South African Revenue Service

which had over 15,000 staff while Nigeria with a bigger economy had about

6,000 staff for its federal revenue agency notwithstanding the difference in

the tax systems of the two countries.

4.1.18 Redraft the Tax Laws to Address Ambiguities and Unfriendly Investment

Provisions

The need for tax laws redraft to make them simple and free of undesirable

provisions was also noted and a good starting point would be to re-enact

the income tax laws (Companies Income Tax Act, Personal Income Tax Act)

and possibly make them available in the 3 main languages.

Certain provisions of the law, especially commencement rules which

imposed double taxation on start-up companies should be amended. Taxes

should be paid only once on actual profit made, not twice given that such

start-up companies were often fragile and therefore unable to bear the

extra burden.

Nigeria is unable to attract holding company investment and may never be

able to do so until the provisions of the Companies Income Tax Act (CITA)-

which imposes double taxation on companies’ profits by levying additional

30% on the profit of a company if the company had reinvested the profit or

delayed its dividend payment rather than pay out all the profits in the same

year they were generated - was amended. This is a huge disincentive to

economic growth and the use of Nigeria as headquarters location for group

entities.

There was also need to expunge the minimum tax provisions for companies

which force them to pay tax out of their capital when they make losses or

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small profits. This was noted as a disincentive to promotion of investment

and growth.

4.1.19 Creation of National Assembly Committees on Tax Matters

The case for the creation of Committees on Tax Matters in the Senate and

House of Representatives or a Joint Committee of the National Assembly to

ensure more focus on tax matters was canvassed for timely actions and

robust decisions on tax matters from time to time in consultation with key

stakeholders.

The President concluded the suggestions for the incoming government by

enjoining the government to implement the points and suggestions raised

above.

4.1.20 Defence of the CITN Charter

The President announced to Members that the long standing dispute

between the Institute and the Institute of Chartered Accountants of Nigeria

(ICAN) had finally been laid to rest with the signing of a Memorandum of

Understanding (MoU) and Terms of Settlement (ToS) with ICAN with the

formal signing and tripartite press conference held on 10th March, 2015 at

the Golden Gate Paradise, Ikoyi, Lagos. He acknowledged the role of the

Association of Professional Bodies of Nigeria (APBN) through which the truce

was reached. He particularly saluted the effort of the current President of

APBN, Mr. G. Fasoto, FCTI for being there when the imbroglio started and still

there when it was finally resolved.

He informed all that the ToS had been filed at the Supreme Court and on

the basis of which the apex court had since struck out the appeal and cross

appeal filed by ICAN and CITN respectively. The President noted that CITN

preserved its mandate as the only body that regulates the taxation

profession in Nigeria while the truce now provides an opportunity for ICAN

members to become members of the Institute through direct membership.

In the long run, all professionals who seek to practice taxation would come

under the umbrella of the Institute which would ultimately enhance activities

within the Nigerian tax system.

4.2 STATUS REPORT ON THE PRESIDENT’S SIX POINT AGENDA –

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4.2.1 Development of Technical and Research Capacity of the Institute

The President updated members on several memoranda submitted on

various issues to stakeholders in the Nigerian tax system which included:

➢ Memorandum to the National Assembly on the “Office of the Auditor-

General for the Federation Bill, 2014

➢ Memorandum to the APBN on state of the Nigerian economy

➢ Memorandum on multiple taxation and the legality of states

to enact tax laws

➢ CITN position paper on “ Tax Payers as sureties in court being

an order of the Chief Judge of Ondo State”

➢ Memorandum on Copyright Levies

➢ Memorandum on a Bill for an Act To Amend Oil And Gas

Export Free Zone Authority (Sb283)

➢ Memorandum on Waivers and Concessions

4.2.2 Launch of the Institute’s publications – CITN Nigerian Tax Guides and

Statutes, Tax Treaty Manual and Text on Indirect Taxes in Nigeria

In line with one of the key flanks of his six point agenda, the President noted

the encouragement he gave to the tax faculties to be active drivers of the

Institute’s research function. Accordingly, after several years with

contributions from successive Presidents of the Institute, he noted that the

Institute’s reference book, the CITN Nigeria Tax Guide 2nd Edition, Volumes 1

and 2 had been published. The formal launch was held on 5th March, 2015

while other publications of tax faculties were equally launched during the

event viz the Tax Treaty Manual and Text on Indirect Taxes in Nigeria. He

informed all that efforts were presently underway to publish a text on Value

Added Tax (VAT) in Nigeria as well as Guide on Expatriate Taxation in

Nigeria.

4.2.3 Collaboration with Knowledge Development Partners

In order to spread the reach with regards to continuous training

programmes for tax professionals, it was reported that an MoU with Thistle

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Praxis Consulting and the Centre for Petroleum and Mineral Law Research

(CPMLR) had been signed in the course of the year under review.

While the MoU between CITN and Thistle Praxis Consulting Limited was for

the purpose of organising a Stakeholder Sustainability Dialogue Series (SSDS)

a half day seminar and/or workshop curated by the Thistle Praxis on various

sectors and disciplines with a view to engaging a wide spectrum of

stakeholders on sustainability imperative in Nigeria would be organized. The

SSDS on taxation was aimed at demystifying the challenges in implementing

Corporate Sustainability Report (CSR) as a tax cutting investment as well as

making the business case for sustainability. The first of the seminar series

which was scheduled to hold in April 2015 had to be rescheduled for a later

date which would be made known in due course.

The second MoU between the Institute and Centre for Petroleum and

Mineral Law Research (CPMLR) was for the purpose of establishing a

mutually beneficial cooperation in respect of training and collaboration

towards joint conduct of post graduate training in upstream petroleum,

mining and renewable energy taxation, fiscal valuation and contract

management with specific tax modules as moderated by the Institute.

4.2.3 Restructuring of the Secretariat and Manpower Development for Members

and Staff

The President underscored the importance of a well-trained and motivated

workforce in driving the Institute’s programmes. In the year under review, he

noted Council’s commissioning of a firm of Human Resource and

Management Consultants in June 2014 to undertake a competency

evaluation of managerial cadre staff of the Institute. On receipt of this

report, Council set up a special review Committee to examine the report

and recommend further action. The recommendations of the Committee

was considered and approved by Council and implementation of the key

recommendations were noted for action. Further to this, Council at its

meeting held on Friday, 17th April, 2015 approved the appointment of Mr.

Adefisayo Awogbade, FCTI as the substantive Registrar/Chief Executive.

Other measures towards ensuring that the Secretariat improves on service

delivery to members and other stakeholders were already being put in

place.

4.2.4 Accelerate the processes for the establishment of a Tax Academy for Nigeria

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The President noted, with gratification, that the Governing Council of the

Nigerian Academy of Taxation (NAT) had been inaugurated on March 5,

2015. He said this was a landmark step in efforts towards realizing the dream

of establishing the tax academy. He informed all also that other vital organs

of the NAT including the Curriculum Development Board, appointment of the

Chancellor, Provost and Registrar of the Academy had been constituted.

Members were also informed that the process of registering the NAT as a

corporate entity was ongoing with the Corporate Affairs Commission and the

Federal Ministry of Education. In a short while academic programmes would

commence, in the interim, from the Tax Professionals’ House and members

were urged to look out for the activities of the Academy to be released in

the course of the year and take active part as well.

4.2.5 Strengthening our National and International Outreach Activities

In terms of national outreach activities, the President noted with satisfaction

the positive visibility the Institute was enjoying while he informed all that

during the period, the Institute engaged with and paid courtesy visits to

some stakeholders in the Nigerian tax system and other government

functionaries. A brief account of these engagements were presented.

4.2.6 Courtesy Visit to the Coordinating Minister of the Economy and Minister of

Finance

The President led a team on a courtesy visit to the then Coordinating Minister

of the Economy and Minister of Finance, Dr. (Mrs.) Ngozi Okonjo Iweala on

11th August, 2014 in Abuja. The visit provided an opportunity for the Institute

to engage with the Coordinating Minister for the Economy (CME) on some of

the following issues;

• Engagement of Stakeholders in matters of Revenue generation

• Revenues Lost as a result of Import Waivers

• Proposal on the creation of tax unit in Ministries Departments and

Agencies of Government and the expansion of opportunities for Tax

Professionals in MDA’s

• The need to Create the Committee on Taxation in the two (2) houses

of the National Assembly

• Non-remittance of taxes withheld by the MDA’s

4.2.7 Courtesy Visit to the Comptroller-General of Customs

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A delegation of the Institute paid a courtesy visit to the Comptroller-General

of Customs, Alhaji Dikko Inde Abdullahi, ACTI, CFR on Tuesday, 4th

November, 2014. During the visit, discussions on possible areas of

collaboration including training, encouragement of officers of the Service to

join the Institute, and finalization of an MoU for training of officers of the

Service which had been in the works for a long time were broached. He

noted that the Institute was still in constant touch with relevant officers of the

Service with a view to bringing to fruition promises made by the CG during

the visit.

4.2.8 Courtesy Visit to the Secretary to the Government of the Federation

In continuation of the Institute’s advocacy and sensitization visits, the

Intergovernmental Relations Committee of Council headed by Mr. O.

Chuke, FCTI, facilitated a courtesy visit of the Institute’s leadership to the

immediate past Secretary to the Government of the Federation, Senator

Anyim Pius Anyim, GCON in Abuja on 18th November, 2014. The visit was

reported to be fruitful as it provided a platform for the Institute to voice its

concerns about many issues ranging from;

➢ Non Inclusion of CITN in government protocol list;

➢ The exclusion of CITN/Tax professionals at the National Conference;

➢ Need to give slots to the CITN at the National Institute for Policy and

Strategic Studies(NIPSS);

➢ National Honours for Distinguished Members of the Institute and

outstanding tax payers;

➢ Creation of the position of Special Adviser to President on Taxation;

➢ Need for the presentation of a Finance Bill along with the yearly

Appropriation Bill which should have minimum tax contents on sources of

revenue for appropriation and proposed tax policy direction for ease of

planning by relevant stakeholders;

➢ Amendment to tax laws should be accorded priority by government with

preparation made in advance and passed alongside the Appropriation

Bill as a basis for implementing the tax contents of the budget; and

➢ Soliciting for the support of the SGF towards the activities of the Institute.

The SGF, noted the Institute’s concerns and assured that the request to

include the Institute in government’s protocol list had been taken care of.

On the request for slots at the NIPSS, he requested the Institute to make

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representations to the office of the Vice President who oversees such

request while assuring that he was willing to put in a word so as to ensure

that it received favourable consideration. Action points from this visit were

being pursued to a logical conclusion.

4.2.9 Attendance at the 2015 Conference/Meeting of the Confederation Fiscale

Europeenne.

The President recalled that the need to continually remain visible

internationally led the Institute to honour an invitation to attend the 2015

conference and meeting of the Confederation Fiscale Europeenne (CFE)

held in Brussels, Belgium from 25th- 26th March, 2015. He attended the

conference in the company of the Vice President, Dr. (Mrs.) Teju Somorin.

The CFE is the umbrella body for tax advisers in Europe. He recalled that

during the 2013 Conference of the body held in St. Petersburg, Russia which

he attended, a declaration was signed with the intent to establish the

Global Tax Advisers Cooperation Forum. The 2015 meeting equally provided

a platform for those present to discuss further on this initiative. The Institute

would continue to explore opportunities such as this to network and register

its presence amongst similar Institutes the world over.

4.2.10 Sustainability of Activities of the National Body and our District Societies

Further to the President’s agenda for the establishment of new district

societies and further to Council’s approval, he led a delegation to Anambra

State for the inauguration of the Awka and District Society of the Institute in

December, 2014. With the inauguration of Awka and District Society on

Saturday, 6th December, 2014, Jos and District Society on Wednesday, 25th

March, 2015 and Asaba and District Society on Tuesday, 19th May, 2015, the

Institute now has 29 District Societies in the CITN family.

4.2.11 Tax Professionals’ House

The President reported that the building where the Institute was holding its

Annual General Meeting is the Tax Professionals’ House, owned, constructed

and equipped by the Institute. This building was commissioned on Thursday,

7th May, 2015 by a representative of His Excellency, Dr. Goodluck Ebele

Jonathan, GCFR. This was noted as results of years of hardwork and

sacrifice by successive leadership of the Institute. With the completion of this

complex, the Institute would be better able to perform in its operations.

4.2.12 Outstanding Subscription

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The issue of non-payment of subscription by members continued to hamper

activities. Council had directed forthwith that members’ failure to honour

their obligations to the Institute including the payment of subscriptions would

leave the Institute no option other than to delist such members. The

President therefore advised members to do the needful in order to enable

the Institute serve all better.

4.2.13 Appreciation

In appreciation, the President thanked all those who had worked with him

over the previous year and in the course of his two year tenure. Firstly, he

thanked God Almighty for his protection and providing him with wisdom.

Secondly, he appreciated his wife and children as well as extended family

for their support and show of understanding all through the period during

Institute’s engagements both within and outside the country. He

appreciated past Presidents, members of the Executive Committee of

Council, Council Members, Chairmen of Committees and members, Staff of

the Secretariat and indeed all stakeholders, he appreciated their strong

support that has accounted for the continued growth and sustenance of

the Institute. He also acknowledged the efforts and contributions of his

Personal Assistant in person of Mr. M. Akonafua for his contributions towards

his successful tenure.

4.2.14 Conclusion

In concluding, it was noted that the Institute was on the forward march in

the advancement of its Charter, the President noted that members would

give effect to the expectations that all would continue to play their

respective roles in advancing the course of the Institute and the taxation

profession in Nigeria.

5.0 REPORTS OF COUNCIL AND COMMITTEES

The President drew attention of members to the Reports of Council and

Committees which were highlighted in the Annual Report. He recalled that

the reports were earlier placed on the website to enable members have

access and therefore should be taken as read.

6.0 AUDITORS’ REPORT

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The representative of Sola Oyetayo & Co. (Chartered Accountants) in

person of Mr. Akeem Taofik, presented the Auditors’ report of the Financial

Statements for the year ended 31st December 2014.

6.1 AUDITED FINANCIAL STATEMENTS

The Honorary Treasurer, Mr. A. I. Adedayo (m/n 1704) thereafter presented

his report on the Audited Financial Statements of the Institute for the year

ended 31st December 2014. He highlighted that the Institute recorded a

total deficit of N105,404,000 and that was partly attributed to the following:

Significant drop in respect of income from self-financing programmes

from N148,950,000 in 2013 to N59,209,000 for 2014

Increase in personnel cost due to upward review in staff salary by 15%

and recruitment of additional staff to strengthen human capacity of

secretariat

Impairment charges relating to members’ inability to meet their

obligations towards the Institute put at N44,467,000 in 2014 from

N43,797,000 in 2013.

On a positive note however, he noted that the Tax Professionals’ house had

been completed without the Institute resorting to loans to complete the

project and thanked all the members that had contributed their fair share

for making this possible.

7.0 MOTION TO ADOPT ANNUAL REPORTS AND ACCOUNTS

The motion for the adoption of all reports presented for discussion was

moved by Dr. A. Adebanjo (m/n 245) and seconded by Barr. O. David (m/n

8544). The motion was unanimously accepted by all members present for

further deliberation.

At this point, the President enjoined all to welcome Mr. K. Oladimeji, FCTI

who was attending the AGM from Canada.

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7.1 COMMENTS ON REPORTS AND ACCOUNTS

Mrs. T. Fowokan (m/n 6855) drew members’ attention to President’s

statement at page 16 of the Annual reports and account to the issue of

draft contracts review relating to tax matters saying that recourse per

arbitration on such issues usually goes to Institute of Chartered Accountants

of Nigeria rather than the Chartered Institute of Taxation of Nigeria as arbiter

in that regard.

Mr. E. Ashade (m/n 10508) drew members’ attention to page 69, noted 18

under deferred income with respect to the unidentified receipts. He noted

that he expected to see notes explaining the nature of the unidentified

receipts.

Mr. A. Alaba (m/n 13693) harped on members’ failure to pay subscription

and removal from members’ register. He suggested a 15-year lump sum as

life subscription based on the assumption that those constituting

membership of the Institute may fall within the age bracket of 40 years and

above and Tax Practitioners in practise may not be able to meet up with

their subscription obligations as would have been the case if they were in

private employment where the companies pick up the subscription

payment on behalf of their staff. He proceeded with respect to those owing

for several years suggesting that they should be allowed to pay 2 or 3 years

subscriptions after which they would be considered as financial members

and their names would become active. He submitted that should members

fail to comply with these concessionary offer the Institute would then be

justified in delisting such defaulting members names from the Register. He

further requested Council to review the Mandatory Professional Training

Programme fees downwards in the light of current economic realities and to

also encourage members to participate more in the Institute’s programmes.

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Mr. V. Okhiria (m/n 804) referred members to page 39 in relation to

statement of net assets as reported by the Honorary Treasurer (HT) asking

same for further clarification since the heading found on that page was not

as reported by the HT. He also made reference to page 60 under 19.2 per

comparative figures under students’ income noting the last two items

thereunder in particular, he asked about the trend per comparative figures

for income and expenditure and what factors were responsible for the

figures as indicated.

Dr. E. Williams (m/n 6961) requested to know what had become of

members’ insurance provision for deceased members noting the provision

for insurance of N2,257,000 in the financial statement as indicated at page

63. He also requested more clarification as to where losses were disclosed in

the financial statement.

Mr. G. Eta (m/n 16827) congratulated the President, Council and

management for the reduction in transport recorded in the financial

statement.

Mr. I. Thompson (m/n 8571) equally commended Council for the completion

of the Tax Professionals’ House as well as training programmes for staff of the

secretariat for enhancement of capacity. He observed that the report by

activities of individual committees and their accrued cost were not

indicated in such a way as to help him appreciate the cost that goes into

the activities. He called for adequate disclosure in this regard. He also called

for separate indication of Council’s expenses as a separate line item under

expenditure rather than been captioned under administrative expenses as

indicated in the financial statement. He therefore called for adequate

disclosure in this regard as well, going forward.

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He also touched on the dwindling nature of income relative to its

expenditure profile of the Institute stressing the need for expenses to adjust

accordingly when such was the case rather than record increases in

expenses, the income profile notwithstanding, in this regard. He called on

Council to brief members on effort at ensuring members’ welfare as well. He

challenged the Institute to come up with disaggregation of membership

data so as to know those gainfully employed, those unemployed and efforts

being made by the Institute for the benefit of members. He equally harped

on the need for sustained advocacy calling on the Institute to do more.

Alh. Lasisi Fasheun (m/n 975) touched on the issue of self-financing

programmes calling on members to participate at these programmes. He

also questioned why seminars/workshops would be done in the face of

losses wondering if they were not subjected to the scrutiny of the Finance

and General Purpose Committee for proper evaluation before being

carried out. He expressed disappointment on the financial outcome of the

2014 Annual Tax Conference while he also touched on the losses recorded

for annual dinner. On balances standing under payables to the tax

authorities at year end, he advised that these monies be paid in order for

the Institute to be seen as leading by example.

Prof. Uche Jack-Osimiri (m/n 540) commended Council for bringing peace

between CITN and ICAN. He noted that modern taxation birthed with the

Economist and then the Lawyers before the Accountants and Business

Managers in that order. He therefore held that taxation is a multi-disciplinary

profession requiring diversified knowledge of the different professions to

make same robust. He expressed hope that the issue would never be

resurrected again.

7.2 HONORARY TREASURER’S RESPONSE

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The Honorary Treasurer, Mr I. A. Adedayo (m/n 1704), in his response to the

various questions, remarks and comments noted as follows:

i. In response to Mr. E. Ashade (m/n 10508), he responded that

unidentified income was as described in the financial statement noting

that the challenge was due to items not recognised or reported for

specific programmes organised by the Institute

ii. For Mr. A. A. Alaba (m/n 13693) on window of 2 years and 15 years

lump sum subscription payment, he assured all that same would be

looked into. On review of fees for Institute’s programmes, he referred

that to Council

iii. For Mr. Vincent Okhiria (m/n 804) on statement of net assets at page

39, he acknowledged that it was actually supposed to be statement of

changes in net assets and not statement of cash flows for the year

ended 31 December, 2014 and attributed this to printing error. He also

responded to the comments on the comparative cost issue raised at

page 60, note 19.2 saying that some increases in cost of items were

due to economic realities including upgrades to use of hall for exam

purpose in addition to introduction of standards in the conduct of

exams.

iv. In response to Dr. Ezekiel E. Williams (m/n. 6961), he drew his attention

to the losses as recorded under operating deficit under the statement

of changes in net assets at page 39.

v. The acknowledgement by Mr. G. Eta (m/n.16827) for reduction in

transportation was noted.

vi. In response to Mr. I. Thompson (m/n. 8571), he agreed on the issue for

the need to track income relative to growing expenses. He equally

agreed on the issue of committee expenses and activities standing on

their own merit, he also noted the call to report Council expenses

separately as a separate line expense item under expenditure. The HT

further expatiated on the reasons behind staff cost increase noting

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that this was partly due to the implementation of a 15% pay rise

effective January, 2014 and could not be reversed while

implementation had already begun in earnest during the year. He also

shed light on financial projections that did not go the way they were

envisaged but assured all that these issues had been addressed going

forward.

vii. In response to Alh. Lasisi Faseun’s(m/n 975) call for prompt payment of

government taxes, HT explained that certified works paid out at the

end of last year were mainly responsible for those balances

outstanding to government

viii. He finally acknowledged Prof. Uche Jack-Osimiri’s(m/n 446)

contribution on the history of modern taxation

7.3 PRESIDENT’S RESPONSE

The President responded to Mrs. T. Fowokan’s (m/n 6855) comments about

tax related draft contract documents being referred to ICAN assuring all

that there would be no snowball effect post MOU signings with ICAN and

that the Institute shall continue to do its best to ensure its role as guaranteed

under the law is preserved for the overall tax system.

With respect to review of fees for Institutes’ programmes, he said this would

be looked into in terms of its feasibility.

On Members’ welfare/benefit, the President assured all that the insurance

cover for members was still work in progress and would still be taken on

board in the new Presidential term. He informed members of the ongoing

implementation of the approval of free yearly subscription for members that

had attained the age of 65 years and above for the rest of their lives, one

free MPTP annually and requirement that they only pay 50% of the fees for

Annual Tax Conference for attendance.

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On tax advocacy, he challenged the District societies to do more in this

regard. He remarked that Districts should report activities at the local level to

the national body by way of official communications. He cited the Ondo

and Niger states’ appointments of non-members of CITN as Chairmen of

State Internal Revenue Service and how the Institute was able to tackle it

with vigour.

With respect to self-financing programmes, the President noted that the lack

of sponsorship of the tablets distributed at the 2014 Annual Tax Conference

culminated in the losses recorded for that programme.

The President also cited the expenses incurred on the tax professional house

as part of the issues in the outgone year but thanked God for its completion

as things would look up for the better taking savings on rent by Secretariat

also into cognisance as well going forward.

8.0 APPOINTMENT OF EXTERNAL AUDITORS/REMUNERATION FOR EXTERNAL

AUDITORS

The President invited the Deputy Vice President in person of Chief C. Ede (m/n

446) to give the vote of thanks to the external Auditors i.e. Sola Oyetayo &

Co. (Chartered Accountants) for a successful audit to which he gave the

Institute’s gratitude for a job well done.

The motion for their appointment of the External Auditors i.e. Sola Oyetayo &

Co. (Chartered Accountants) as Auditors for the next one year was also

moved by Chief C. Ede (m/n 446) and seconded by Mr. A. Samuel (m/n

3454). The motion was unanimously adopted by members.

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The motion for Council to also fix the remuneration of the External Auditors

was also taken as moved by Chief C. Ede (m/n 446) and seconded by Mr. A.

Samuel (m/n 3454) pursuant to the motion rejoinder by Mr. S. Fagbulu (m/n

9785).

9.0 RESULT OF ELECTION INTO COUNCIL

The Chairman of the Scrutineers, Alh. A. Bello, FCTI (m/n 8214) presented the

result of the election into Council as follows:

Number of ballot papers received - - - - 3,040

Valid votes recorded - - - - - - 1,587

Invalid number of votes - - - - - - 1,453

No. of ballot papers without membership number - 32

Multiple ballot papers in one envelope - - - 207

Ballot papers with wrong membership number - - 108

Ballot papers without signature - - - - - 1

Ballot papers from non-financial members - - - 550

Sealed envelopes without ballot papers - - - 3

Ballot papers by newly admitted members - - - 43

Ballots papers not signed personally by voters - - 320

Ballot papers with multiple voting - - - - 189

The analysis of valid votes cast was presented as follows:

1. Adeola Adekunle Atanda Olushola - - - - 156

2. Agbeluyi Samuel Olushola - - - - - 753

3. Ede Ikemefuna Cyril - - - - - - 544

4. Fowokan Titilayo Eni-Itan - - - - - 384

5. Kato Simon Nwanmagyi - - - - - 266

6. Lamide Kamil Ademola - - - - - 184

7. Makinde Ademola Stephen Kayode - - - 135

8. Okoror Justina Adaku - - - - - 607

9. Omaka Fred Amaghu - - - - - 68

10. Omonayajo Benjamin Akanji - - - - 1,174

11. Otitoju Ayodele Oluyomi - - - - - 1,052

The following members were declared as duly elected into the Council for a

3- year tenure based on the votes cast:

1. Omononayajo Benjamin Akanji - - - - 1,174

2. Otitoju Ayodele Oluyomi - - - - - 1,052

3. Agbeluyi Samuel Olushola- - - - - 753

4. Okoror Justina Adaku - - - - - - 607

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5. Ede Ikemefuna Cyril - - - - - - 544

The President thanked the Scrutineers for a job well done and congratulated

the newly elected and re-elected members to Council and wished the un-

elected ones better luck next time.

10.0 TENURE OF OFFICE OF DEPUTY VICE PRESIDENT

Prof. Uche Jack-Osimiri (m/n 540) withdrew the motion as proposed at the

last Annual General Meeting when it was called up for deliberation.

11.0 ANY OTHER BUSINESS

There was no other business for consideration as none was received before

45 days to the commencement of the AGM as stipulated under the CITN

Act.

12.0 VOTE OF THANKS

The Vice President, Dr. T. Somorin (m/n 87) gave the vote of thanks taking

time to chronicle the 19 achievements of the Chief M. Dike’s (m/n 941)

Presidency in the outgoing Presidential year. She also thanked him for

steering the Institute in the right direction for the past 2 years and for the

successful conduct of the Annual General Meetings.

The Deputy Vice President, Chief C. I. Ede (m/n 446) appreciated all Council

members, Deans of Faculties, Committee members, Chairmen of the Joint

District Society and Registrar/Chief Executive for their presence and

contributions towards the successes recorded in the year under review.

Thereafter, Mr. M.O. Animashaun (1044), Vice Chairman, Social and

Members’ Welfare Committee expressed appreciation to members for their

attendance at the AGM.

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13.0 ADJOURNMENT

The motion for the adjournment of the 23rd AGM till 2016 was moved by

Chief R. Olusola (m/n 8292) and seconded by Hon. J. E. Asuquo (m/n 6288).

The motion was unanimously adopted by members present.

14.0 CLOSING PRAYER

The closing prayer was said by Mr. S. Kato, FCTI (m/n 6403) at 3:29 p.m.

Chief M. A. C. Dike, FCTI Mr. A. Awogbade, FCTI President/Chairman of Council Registrar/Chief Executive

THE CHARTERED INSTITUTE OF TAXATION OF NIGERIA€¦ · 3.2 MATTERS ARISING All matters arising had...

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