The Nigeria Extractive Industries Transparency Initiative (NEITI) has welcomed with encouragement the recent bold decision of the Tax Appeal Tribunal which has ordered Mobil, an oil giant to pay $ 83.4 million to the Federal Inland Revenue Service (FIRS).

The judgment by the Tax Appeal Tribunal represented Education Tax liability of the company to the Federation during the year 2008.

NEITI finds this courageous judgment by the Tribunal as a fundamental positive development in its efforts to draw national attention to the findings and recommendations on the issues of underpayment and underassessment in royalties, taxes, signature bonuses, rents, clearly exposed by its independent audit reports of the oil and gas sector, over the years.

This judgment is also a vindication of the findings of the NEITI 2006 -2008 independent audit of the Oil and Gas sector. In that audit NEITI clearly revealed that Mobil owed $83.28 million Education Tax for 2008. However, before this litigation and landmark judgment by the Tax Appeal Tribunal, Mobil had insisted that it had no Education Tax liability to the Federation.

It is on record that NEITI has consistently alerted the nation that out of $9.8 billion uncovered by its audit reports as the difference between what was paid and what government received, only $2 billion has been recovered through NEITI efforts, leaving a balance of $7.8 in the hands of companies.

The judgment by the Appeal Tribunal is therefore a wake-up call for government agencies to rise up to the challenge and engage companies to remit outstanding revenues due to government.

It is noteworthy that the judgment is coming at a time when Nigeria through the Petroleum Industry Bill, the European Union member countries, United Kingdom and United State are putting in place stringent regulations to compel extractive industry companies to embrace contract transparency, due diligence and corporate social responsibility.

With this judgment by the Tax Appeal Tribunal, NEITI hereby renews its appeal to all relevant government agencies that are responsible for collection and management of oil, gas and mining revenues to engage companies on issues of payments of all outstanding debt owed to the Federation as already identified by NEITI independent audit reports now in the public domain.

At this time that the Federal Government is in search of funds to finance budget deficits and rebuilding of the Country’s social infrastructure, the need to use NEITI independent audit reports to recover funds arising from underpayments and underassessment of taxes, rents and royalties has become a national emergency.

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