Confronting the problem of cross-border tax evasion in an era of greater global transparency of tax relevant information: The case of Nigeria

Abstract

Purpose

This paper aims to examine the Nigeria’s approach for tackling tax evasion, the limitations of double tax conventions for that purpose, the benefits of multilateral instruments/standards for automatic exchange of tax information and Nigeria’s ability to participate in such arrangements.

Design/methodology/approach

This paper is a library-based research, deploying content analysis with respect to books, law reports, law journals and newspapers.

Findings

Nigeria has taken significant steps to deal with domestic tax evasion by tightening anti-money laundering legislation, principally by making tax evasion a predicate offence and by imposing relating reporting obligations on financial institutions and a wide range of designated non financial institutions (DNFI's), but cross-border tax evasion remains a big problem owing to a limited network of double tax conventions (DTCs) and inherent limitations of the machinery in limiting exchange of information to distinct requests. Nigeria’s ability to benefit from new international standards providing for automatic exchange is compromised by the absence of robust rules with respect to taxpayer confidentiality and data protection.

Research limitations/implications

Because the research focused on Nigeria, the findings of the study might not be applicable to other jurisdictions.

Originality/value

Given the devastating effects of tax evasion on development in Nigeria and the priority accorded to the eradication of the problem in the sustainable development goals, this paper meets a need to determine the extent of sufficiency of Nigeria’s legal and regulatory framework in enabling the country to tackle tax evasion.

Citation

Obadina, D.A. (2016), "Confronting the problem of cross-border tax evasion in an era of greater global transparency of tax relevant information: The case of Nigeria", Journal of Money Laundering Control, Vol. 19 No. 4, pp. 470-499. https://doi.org/10.1108/JMLC-10-2015-0043