Multiple taxes: Insurance industry gets N1billion refund

0
88

Matthew Otoijagha

Nigerian Insurers Association (NIA)’ outgoing chairman, Eddie Efekoha, has said his tenure successfully addressed some critical industry challenges, especially multiple taxes from tax authorities; he attributed successes achieved during tenure to support and cooperation from members of the association.

At a recent insurance forum, he said the NIA engaged the federal ministry of finance and federal inland revenue services, FIRS, to address the country’s tax regime. “We have equally reached some level of understanding with the leadership of FIRS to reduce the friction between them and some of our members. Our target is to seek amendment of the tax laws to avoid multiple taxation which affects what accrues to our stakeholders. We need to tackle it to enable us remain in business”, he said.

He said the engagement resulted in tax refund of one billion naira in 2017, which the Association used for the building of its secretary.  According to him, the building would cost N1.5 billion to complete in the next two years and the balance of N500 million have been contributed by members.

He expressed grateful to the entire members of NIA in ensuring that the association was able to move from discussion to the point of actual construction phase of the NIA secretariat building.

The outgoing boss said the high point of his tenure is the NIA secretariat building. He said, “I must commend the entire members of NIA for setting aside funds for the project. It is not easy to part with money. Just at the point we were discussing funding the project, the issue of tax refund from the government materialized.

“When we did the 2007 consolidation exercise, we were made to pay so much of tax without the opportunity of questioning how this tax liability was arrived at. Members felt that we have been short changed. So we engaged solicitors to help us intervene with the tax authority.

“In 2017, during my tenure, the industry got a refund of almost N1 billion from the tax paid during the consolidation exercise. So, what we agreed is that, at that point, the building committee has gotten approval from the council to approve a basis of contribution towards funding this project.

“Initially, we thought that N1 billion will be enough to complete this project and therefore we will levy ourselves 50 percent and get the other 50 percent from loans. As members, we agreed that we should remit some of the refund as our levy.

“For instance, if my levy is N5 million and I was refunded N10 million, we agreed that N5 million should go to the project and then, the remaining N5 million should be given to me. That was how we successfully raised this compulsory levy. That we have N500 million to start the building, I think we have cross the difficult phase. I commend members for their cooperation.”

On insurance rebranding, Efekoha said NIA members are fully committed into it. He said, “They have made their contribution and that is why the program has kicked off. We believe the rebranding will help improve the insurance industry as it is not going to focus on one particular company, but the industry as a whole, the value one can get from insurance.

Now that the National Insurance Commission (NAICOM) has made N100 per cent contribution, we are equally ready to contribute our 50 per cent balance.”

Speaking on engagement with various stakeholders, NIA boss said, “We engage with the NAICOM in several ways, either from the corporate governance end or from the market development end, or even from the policyholder protection end.

“Another principal stakeholder is the National Assembly because they are the ones formulating laws, in the last two years; we have couple of bills proposed by members of the industry. We have a bill on the principles of insurance and how insurance should be conducted. We have not be able to retrieve some of the bills we have lost, but at least our market share and products have not been taken away from us in the last two years.

“Another stakeholder is the government represented by the ministry of finance. One of the major issues we have been discussing with the ministry is the issue of tax. We will continue to engage the federal Inland Revenue Service and the ministry of finance on that.”

Speaking further he said that that NIID project has made an impressive progress in the last 2years. Buttressing his point he said that NIID has made it impossible to insure a car twice and has made it easy to check the validity of the insurance carried by drivers. He added that about 2.3 million vehicles are on the NIID platform now.

Share

LEAVE A REPLY

Please enter your comment!
Please enter your name here