Audit observed that:
i. Four (4) payments totaling 250,407,363.67 (Two hundred and fifty million, four hundred and seven thousand, three hundred and sixty-three naira, sixty-seven kobo) were made to four contractors as mobilization fees in December, 2017 and April, 2019,
ii. 5% Statutory WHT of 12,520,368.18 (Twelve million five hundred and twenty thousand, three hundred and sixty-eight naira, eighteen kobo) and 5% VAT of 12,520,368.18 (Twelve million, five hundred and twenty thousand, three hundred and sixty-eight naira, eighteen kobo) totaling 25,040,736.37 (Twenty five million and forty thousand, seven hundred and thirty-six naira, thirty-seven kobo) were not deducted from the amount paid to contractors, and
iii. Payment vouchers relating to subsequent payments made to three (3) of the contractors vide payment vouchers number DHQ/CBN/CAP/18/008, DHQ/CBN/CAP/18/046 & DHQ/CBN/CAP/18/051 dated 2nd February, 2018; 1st August, 2018 and 1st August, 2018 respectively showed that the tax element on the initial payment of the mobilization fees were not deducted in the subsequent payments, thereby leading to overpayment to contractors and loss of revenue to the Federal Government totaling 21,321,356.37 (Twenty-one million, three hundred and twenty-one thousand, three hundred and fifty-six naira, thirty-seven kobo) due to non-deduction of statutory taxes.
The Director-General is requested to:
i. Justify why mobilization fees were paid without deducting statutory taxes.
ii. Recover the sum of 21,321,356.37 from the affected contractors and remit same to the relevant tax authorities.
iii. Forward evidence of remittance to the Public Accounts Committees of the National Assembly, and
iv. Otherwise, apply sanctions relating to failure to provide for VAT and WHT and failure to collect and account for Government Revenue specified in paragraphs 234(ii) and 3112 of the Financial Regulations respectively.
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