FOR failing to file their tax returns
after the statutory period, the Corporate Affairs Commission (CAC) has stated
that it would delist 49,000 registered companies from its register. Indeed, the
Commission stated that a large number of registered companies in its database
have not fulfilled their statutory regulations in terms of filing of returns
while many have refused to state the non-existence of their businesses.
Specifically, the CAC noted
that at least 414,000 companies did not file their returns
in 2010 out of about
one million registered businesses in the country, thus necessitating the
renewed action set to be taken.
Special Adviser to the
Registrar General, CAC, Garba Abubakar while speaking at a seminar organized by
the Professional Practice Group of the Lagos Chamber of Commerce and Industry
(LCCI) in Lagos, yesterday, stated that most businesses registered in the
country have no proper structure and have defaulted in their incorporation
requirements.
According to him,
investigations show that businesses terminate the relationships with their
professionals after incorporation while most professionals are found wanting in
responsibly advising their clients.
“We observed that 60 per
cent of the cost of starting a business goes to professionals as fees, a
condition many small businesses have found not to be sustainable. Also, most
companies do not have ascertainable capital base unlike what other sectoral
regulators prescribe.
“To ease the process, CAC
decided to address bottlenecks in the system with a new platform. Although we
are experiencing some challenges, we hope to address them in due time”.
President, LCCI, Alhaji
Remi Bello emphasized the need for government to create a conducive environment
for businesses to thrive.
According to him, structuring
businesses for effective regulatory compliance is significant because many
businesses are having compliance issues with the various regulators that
oversee their operations.
“We are gradually moving
towards a growing formal economy where companies would have no choice but to
play according to the rules. Businesses built and run in contravention are
often not sustainable in the long run.
“Policy consistency remains
a valuable ingredient for a sound regulatory environment. We call for more
consultations with the private sector in the formulation of policies and
regulations. This will ensure better compliance and consistency irrespective of
changes in the leadership of regulatory authorities”, he added.
Chairman of the Professional
Practice Group of the LCCI, Abayomi Adebanjo noted that professionals occupy a
key position in the implementation of policies in the country and their role
should not be ignored especially in the area of policy implementation.
According to him, though lofty in
its aspirations, the 24 hours duration for the incorporation of businesses is
unrealistic considering the various bottlenecks encountered by businesses in
the course of registering a business.
“There is a need for
increased stakeholder engagement to aid the implementation of policies. Making
declarations on the timeline for business incorporation should be considered
alongside other factors as there are other regulators involved in the process.
We need structures that are sustainable to engender growth in the country”, he
added.
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