Nigeria was ripped off US$30B by oil companies on taxes and royalties – Audit finds

Jun 25, 2022 News

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Kaieteur News – A 2019 report by the National Extractive Industries Extractive Initiative (NEITI) in Nigeria had revealed that 77 oil companies operating in the country had attempted to rip off the federal government N2.659 trillion which translates into US$30,334,400,460 in tax and royalty payments.

The debt was uncovered following an investigation to ascertain payments due to the country.
As such, according to Nigerian media reports, the House of Representatives in March 2022, asked oil and gas companies with outstanding debts owed to the federal government to present evidence of taxes, royalties and levies. They had even threatened legal actions if the oil companies had failed to comply.
Executive Secretary of NEITI, Orji Ogbonnaya, in 2021 had explained that the debts were a result of the companies’ failure to remit petroleum profit tax, company income tax, education tax, value-added tax, withholding tax, royalty, and concession on rentals. However, he did not provide the names of the companies.
Ogbonnaya had explained that the figure is based on findings in the NEITI 2019 audit reports of the oil and gas sector.
Nigerian media reports indicated that Ogbonnaya had related to the fact that the owed money could be useful at a time the government is borrowing money to fund its budget.
Moreover, according to Premium Times report, Ogbonnaya said oil and gas companies owe US$143.99 million as petroleum profit taxes, US$1.089 billion as company income taxes, and US$201.69 million as education tax.
“Others include $18.46 million and £972,000 as Value Added Tax, $23.91 million and £997, 000 as Withholding Tax, $4.357 billion as royalty oil, $292.44 million as royalty gas, while $270.187 million and $41.86 million were unremitted gas flare penalties and concession rentals respectively,” he had said.

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