FEC approves Executive Orders on VAT and Excise Duties alongside five Amendment Bills

In a show of commitment towards reducing the tax burden and improving the ease of doing business for taxpayers, the Federal Executive Council (FEC or the Council) has approved two Executive Orders and five Amendment Bills touching on key provisions in the Nigerian tax and regulatory legislation. This communication was released by the Minister of Finance, Mrs. Kemi Adeosun, after the Council meeting on Wednesday, 6 June 2018.

Cost Contribution Arrangements (“CCAs”)

Managing conflicts between domestic laws and adopted international tax guidelines and best practices in Nigeria The last six years have witnessed significant efforts by Nigeria to align its domestic tax laws and regulations with international initiatives on modernization of its tax principles and enhancement of transparency and disclosure requirements. These efforts included the introduction of Income Tax (Transfer Pricing) Regulations No.1 in August 2012 (“TP Regulations”), which adopted international best practices for determining the arm’s length/market value of transactions between related parties. Nigeria has also been participating in global initiatives aimed at tackling tax evasion and tax revenue leakages.

Economic Recovery and Growth Plan (ERGP): An assessment of the journey so far

The Economic Recovery and Growth Plan (ERGP) is a medium term all-round developmental initiative focused on restoring growth, investing in people and building a globally competitive economy. The ERGP was launched in April 2017. Precisely one year after its implementation, we examine the performance of the Plan in line with set execution principles in the table below.

The Continental Free Trade Agreement: Is no deal the right deal for Nigeria?

On 22 March 2018 in Kigali, Rwanda, Heads of State of forty-four African countries, gathered to sign the African Continental Free Trade Agreement (“AfCFTA” or “the Agreement”), the landmark agreement which amongst others aims to liberalize trade across Africa.

FEC Approves Revised National Tax Policy

Nigeria announces three-month extension of tax amnesty programme

President Muhammadu Buhari has approved the extension of the Voluntary Assets and Income Declaration Scheme (VAIDS or the Scheme) by three months. The Scheme which originally lasted for 9 months and expired on 31 March 2018 will now run till 30 June 2018. As the original deadline was premised on an executive order, a fresh executive order will be issued to give legal backing to the new timeline.

Nigeria’s new excise regime: Is this the right time?

Barring any last minute reversal, locally manufactured tobacco and alcoholic beverages (“Excisable Products”) will be subject to a new excise regime from 4 June 2018. This new regime is pursuant to Section 13 of the Customs, Excise Tariff Etc. (Consolidation) Act which enables the Nigerian President to impose, vary or remove any import or excise duty.

IFRS 15 – Revenue from contracts with customers

Board consideration As with any new IFRS implementation, board oversight at an early stage and on an ongoing basis is critical. In order to ensure an effective and efficient implementation process, it is imperative that the board remains engaged in this process and sets the tone for the entity.

Lagos State Government announces changes to the Land Use Charge Law

The Lagos State Government (LASG) has announced revisions to provisions of the Land Use Charge Law 2018 (LUC Law); principally covering a reduction in land use charge (LUC) payable on various categories of property in Lagos State.

IFRS 15: Are you ready for the “Big Change ?

The recognition criteria of revenue in accounting standards is about to change—and your entity might be significantly affected, maybe even more than you expect!

Taxation of commissions payable to insurance brokers/agents – An obligation or a nightmare?

The insurance industry is one of the specialised businesses having a peculiar business model and corresponding distinct tax considerations in Nigeria. The core business of insurers/insurance companies, simply put, is to provide cover to another party (insured), against possible financial loss within a specified period. In return, the insured pays an insurance premium at the inception of the cover period, which forms part of the income reported in the books of the insurer. A critical aspect of the business expansion mechanism in the insurance industry revolves round brokers and agents. Insurance brokers/agents act as middle men; bridging the gap and linking insurers with potential insured parties seeking to hedge against risks. Insurance companies incur costs in sourcing the services of brokers/agents (commissions). Commissions are often calculated as a percentage of the insurance premium, depending on a number of factors such as coverage, the insurer and marketing methods, etc. Although the…