Following increasing complain of unlawful charges by the federal ministries, departments and agencies (MDAs), the House of Representatives has set up an Adhoc Committee to investigate the matter.
The motion to for the House’s intervention was raised by Kpam Jimin Sokpo (PDP, Benue) at the plenary on 20th January, 2022 and was adopted by the plenary.
Presenting the motion, he said, the process of awarding contracts on projects mandates contractors to pay Value Added Tax and Withholding Tax, and are the only charges required by law for contractors to pay to the government for the award of the contracts.
He alleged that, MDAs are now collecting arbitrary, indiscriminate and unlawful administrative charges, levies and contract fees ranging from 5% to 25% of contract sums to be paid by contractors to MDAs officials.
He said: “Such charges by the MDAs are unlawful, fraudulent and clear cases of corrupt practices as such monies when collected, are not remitted to government coffers.
“The contractors are compelled to pay such advance fees, there is the high tendency of not keeping to the terms of the contract as such projects are often abandoned or poorly executed”.
However, these unlawful charges have become epidemic of some sort as all state MDAs also indulge in it and its choking businesses to death in Nigeria. Local government authorities are also neck deep in this anti small business act.
Hundreds of thousands of micro and small businesses have collapsed under the weight of these charges, and levies, most of which end in the private pockets of government workers and elected political office holders.