Powers of Revenue Authorities to Call for Returns and Demand for Information under Sections 46 and 47 of the Personal Income Tax Act 1993

Description

ABSTRACT

Powers of Revenue Authorities to Call for Returns and Demand for Information under Sections 46 and 47 of the Personal Income Tax Act 1993

Ifeanyi  Ujah*

Revenue authorities are clothed with the powers to enforce the provisions of PITA and ensure the optimum collection of all taxes due  the government under the relevant tax laws. To actualise the above statutory mandate, the revenue authorities are further conferred with the powers under sections 46 and 47 of the Personal Income Tax Act 1993 (as amended) (PITA) to give notice requiring a person to deliver any return or information specified in the notice. Recently, companies have been issued notices from some states’ revenue authorities requiring them to deliver the Nationwide Payroll of their employees, with their appointment letters to determine their compliance with the tax remittance obligations on the employees. This raises concerns over the extent of the powers of revenue authorities to call for returns or demand for information under PITA vis à-vis the scope of duties owed by companies/recipients of such notices to the revenue authorities. This article examines these powers within the purview of the provisions of PITA. It posits that the powers are not unlimited. Instead, they are circumscribed by the principle of residency, which determines the respective tax enforcement jurisdictions of the revenue authorities to collect the income taxes on the taxpayers under PITA. Accordingly, no person (individual or corporate) is bound to honour any notice issued by the revenue authorities in furtherance of the enforcement of tax obligations under PITA, where the notice purports to call for a return or demand for the information of taxpayers who are not resident within the territory or state of the relevant revenue authority.

Keywords: Notices, Residency, Returns, Revenue Authority, Taxation

INTRODUCTION
The administration of personal income tax in Nigeria is primarily governed by the provisions of the Constitution of the Federal Republic of Nigeria, 1999 (as amended) (Constitution) and the Personal Income Tax Act 1993 (as amended) (PITA). As seen in its long title, the PITA imposes income tax on individuals, communities, families, executors, and trustees and provides for the tax’s assessment, collection, and administration. To achieve the latter objective, it creates revenue authorities₁ for the respective state governments, including the Federal Capital Territory, Abuja₂ and, amongst other things, gives them the powers under sections 46 and 47 of the Personal Income Tax Act (PITA) 1993

*LL.B (UNN), B.L (Nig), ACITN, AICMC and Associate, PUNUKA Attorneys & Solicitors Lagos,Nigeria.

1. For the purpose of this articles, revenue authorities and tax authorities mean the same thing and are used interchangeably.
2. See PITA, ss 87 and 108.

THE GRAVITAS REVIEW OF BUSINESS & PROPERTY LAW Vol.15 No.1