Fed Govt to deduct illegal state taxes from federation allocation

The Federal Government has resolved to deduct from federal allocation any illegal taxes by states on the mining sector.

This is even as it has advised states to register companies and participate in mining but not as sub-national authorities as the law is very clear, declaring that “The Federal Government has exclusive right to mine and manage all mineral resources.”

This decision was taken at the 11th virtual meeting of the Federal Executive Council (FEC) presided over by President Muhammadu Buhari, where a minute silence was observed in honour of Rear Admiral Olufemi Olumide and Major General Sam Momah, who were both members of the Federal Executive Council in the past.

Briefing State House Correspondents at the end of the meeting, Minister of Information and Culture, Alhaji Lai Mohammed, who briefed on behalf of his counterpart in Mines and Steel Development, Olamilekan Adegbite, who presented a memo, largely to ask for council’s approval to address the major challenges the mining industry in facing. He said that the issue of double taxation was actually driving a lot of investors out of the country, hence the approval given the council.

Mohammed said: “Among the challenges the industry is facing, according to the Minister, is that of insecurity in certain parts of the country. Notably, in the North Western part of the country, mining has been suspended because of the activities of bandits and kidnappers. The industry is also faced with the problem of collision between some stakeholders, sometimes the traditional rulers. Also, the minister explained that the issue of double taxation is actually driving a lot of investors out of the country.

He also reported certain decisions of past government in the area of storage of explosives that are used for mining. Before now, the position is that any miner that wants to use explosives for mining must store them in either the military barracks or police facilities. So, he asked for special dispensation to build special facilities at least one in each of the geo-political zones of the country.

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