Secrets Reporters
In a recent development within the Nigerian financial body, the Nigerian Police Trust Fund (NPTF) has been called out for the disappearance of tax funds in its office.
According to a federal audit report, a total of sum of seventy five million, three hundred and sixty three thousand, nine hundred and sixty eight naira, six kobo (₦75,363,968.06) was deducted from the various Ministries, Departments and Agencies as stamp duties from the NPTF’s treasury but was never remitted to the Federal Inland Revenue Service(FIRS) which is responsible for collecting and accounting for federal revenues, enforcing tax laws, and supporting national development through effective fiscal systems.
This has sparked a lot of questions and raised brows at the NPTF unit as their was no clear trace or direction to where the money has vanished to.
Stamp Duty: What and Why It Matters
Stamp duty is a form of tax charged on documents, contracts, and certain transactions. Treasury Circular Ref No. TRY A1 & B1/2017, issued on 20 April 2017, mandates all federal Ministries, Departments, and Agencies (MDAs) to deduct 1% stamp duty from contract agreements and remit it directly to the FIRS before disbursing payment to contractors. The rule is aimed at ensuring timely revenue inflows into the national purse and reinforcing monetary discipline across government structures.
The FIRS, charged with enforcing tax laws, collecting revenue, and safeguarding the financial base for national development, relies heavily on compliance by MDAs. Funds from stamp duty, though relatively small on a per-contract basis, accumulate into significant revenue streams when properly managed which in turn supports budget delivery for health, education, security, and infrastructure.
Audit Findings: NPTF’s Strategic Mission Violated
Set up under an Act of Parliament in 2019, the NPTF exists to ensure a sustainable funding model for the Nigeria Police Force. It funds training, welfare, equipment, and infrastructural development of the Nigeria Police Force.
But investigations show that in 2021, while the funds were deducted as stamp duty from multiple contracts, there is no evidence those funds reached the FIRS. Audit investigated payments, contract documents, and bank records which led to them discovering deductions that were made from contractor payments, yet there was no corresponding payment to the national treasury.
The findings showed a clear process disconnect between deduction and remittance, indicating either gross misconduct or intentional withholding of funds by the NPTF.
A Deafening Silence from Management
After several requests from the auditor’s office to the NPTF, there hasn’t been any response from their management till the time of filing this report. Despite clear directives from the auditor’s office, there was no formal response, no internal memos, and no public statement justifying the absence of remittance.
According to the report, the lack of response serves as evidence of severely weakened internal controls and a lack of financial accountability from the NPTF management.
The auditors noted that without any documented justification, management’s silence itself is a failure on the path of the NPTF management. As long as no credible reason is provided, missing funds are tagged as unremitted and subject to immediate recovery.
The auditor warns that the failure to remit the missing funds represents a direct loss of government revenue which is money that should have been used to fund national projects and essential services. It also jeopardizes the government’s ability to meet budgetary targets, especially in a time when oil revenues have become unreliable.
What is even more worrying is the chances that the money was not just forgotten but may have been used for things it was not meant for. Since there are no records and the NPTF management have not said anything about it, the auditor fears the money might have been secretly taken or misused.
In response to the gravity of the situation, the auditors made a set of recommendations that go beyond mere corrections. They urged that the Executive Secretary must be compelled to justify the non-remittance in writing, and more importantly, to ensure the full amount is remitted to the national treasury without further delay.
They also insist that evidence of this remittance must be submitted to the Public Accounts Committees of the National Assembly, a necessary step in ensuring accountability and transparency.
In the audit’s final recommendation, it further stated that if the NPFT fail to comply, it referenced Sections 3112 and 3129 of the Financial Regulations (2009) to be applied to those found guilty.