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FG Implements New Tax Deduction Regulations to Enhance Compliance and Economic Development in Nigeria

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Our Reporter

Finance Ministry has introduced new regulations for the deduction of tax from source.

These regulations we gathered aren’t known as the Deduction of Tax at Source (Withholding) Regulations 2024, provide guidelines for deducting tax from payments made to taxable individuals and entities under various tax acts.

According to the statement by Minister of Finance and Coordinating Minister of the Economy, Adebayo Olawale. “The implementation of these regulations will begin on July 1st, 2024. The regulations state that eligible transactions will be subject to deductions at specified rates, which vary depending on the nature of the transaction and the residency status of the recipient. Reduced rates will apply to recipients who reside in countries with which Nigeria has a treaty for the avoidance of double taxation.

According to him entities such as corporations, government departments, statutory bodies, and payment agents are responsible for making deductions at source. However, small companies and certain unincorporated bodies are exempt from this requirement if the supplier has a valid Tax Identification Number (TIN) and the transaction value is N2,000,000.00 or less per month.

The Minister said, It is important to note that deductions made at source should not be considered as separate taxes or additional costs. Instead, they are treated as advance or final taxes for the supplier. The obligation to deduct at source arises when payment is made or when the amount due is settled, whichever occurs earlier.

He added that, once deductions are made, the amounts should be remitted to the relevant tax authority within specified timelines. Returns and evidence of remittance must be submitted, including information about the person from whom the deduction was made, the nature of the transaction, and the amount deducted”.

“To ensure compliance with the regulations, receipts for tax deducted must be issued using a provided template. These receipts can be submitted to the relevant tax authority as evidence for claiming tax credit”.

The Minister further stressed that failure to comply with the deduction requirements may result in penalties and interest charges. However, certain transactions, such as compensating payments under a Registered Securities Lending Transaction and dividend payments to Real Estate Investment Trusts or Real Estate Investment Companies, are exempt from deduction at source.

The new Deduction of Tax at Source (Withholding) Regulations aim to simplify tax compliance and administration, reduce discrepancies between corporate and non-corporate structures, and align with global best practices. These regulations replace all previous rules regarding deductions at source, except for Pay-As-You-Earn tax.

The Ministry of Finance expects that these regulations will promote easier tax compliance, ensure fairness in the tax system, and contribute to the overall economic development of Nigeria.

Business & Economy

FG Secures Release of 98 Transmission Equipment Containers Stranded for Decades

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Minister of Power, Joseph Tegbe(right),Comptroller-General of Customs, Bashir Adeniyi,(2n right)

By Jacob Moses,Abuja

The federal government, through the Ministry of Power under the Minister Joseph Tegbe, has secured the release of transmission equipment that have been stranded at the nation’s ports fortwenty years.

Announcing the development at a media briefing in Lagos, Tegbe said the first 44 containers were released from the ENL Terminal and another 54 from the APMT and Sun & Moon Terminals, bringing the total to 98 of over 300 containers held.

The minister explained that the equipment, which includes high-capacity transformers, cables and switchgear, was procured to expand the transmission network and relieve overloaded substations.

Its detention stalled projects, kept existing substations under heavy strain, exposed valuable assets to deterioration and accumulated charges on the cargoes.

He noted that the cost is felt daily by businesses spending more on alternative power, families enduring interruptions and public institutions struggling to maintain essential services.

The release is in response to President Bola Ahmed Tinubu’s directive that the cargoes be cleared immediately, and the Minister and the Comptroller-General of Customs swung into action, working tirelessly to secure it.

Tegbe credited the president for the breakthrough and thanked the Ministers of Finance and of Marine and Blue Economy, the Comptroller-General of Customs, and officials of the Ministry of Power and its agencies.

Speaking at the event, the Comptroller-General of Customs, Bashir Adeniyi, said the release follows the president’s directive for immediate clearance and for agencies to resolve outstanding charges and administrative bottlenecks without delay.

Customs has begun steps to clear the containers, working with the Ministry of Power, the Nigerian Ports Authority and terminal operators.

He pledged to work hand in hand with the Minister until all the containers are cleared, and appealed to terminal operators to give Nigeria the support required for an important national quest.

Upon inspection, most of the equipment was found to be useful and viable. When evacuated, it will be verified, tested and refurbished where necessary, then deployed to project sites to complete stalled installations, relieve overloaded substations and strengthen constrained transmission corridors.

As these projects enter service, they are expected to deliver fewer interruptions from overloading, better voltage performance and a stronger network to carry electricity to homes, businesses and essential services.

Tegbe assured Nigerians that the Ministry would follow the recovery through to installation and commissioning and provide updates on the remaining containers, expressing confidence that they would be released without further delay.

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Business & Economy

Coastal Highway Will Unlock Blue Economy Corridor-Sen.Imasuen … As ABER Pushes for Nigeria Senate Blue Economy Caucus

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By David Owei

The Chairman, Senate Committee on Ethics, Privileges and Public Petitions, Senator Neda Imasuen (Edo South), has described the Lagos-Calabar Coastal Highway as a game-changer that will unlock Nigeria’s Blue Economy corridor and create new opportunities for littoral communities.

Senator Imasuen made the remark on Wednesday in Abuja when the Founder and Convener of the Africa Blue Economy Roundtable (ABER), Dr. Piriye Kiyaramo, led a delegation on a courtesy visit to his office at the National Assembly.

He commended ABER’s advocacy for a community-owned Blue Economy and pledged to study its proposal for the establishment of a Nigeria Senate Blue Economy Caucus (NSBEC).

Presenting the proposal, Dr. Kiyaramo said that despite Nigeria’s 853km coastline, over 3 million artisanal fisherfolk and an estimated $70 billion annual Blue Economy potential, the country still lacks a dedicated parliamentary mechanism to legislate, coordinate, budget and provide oversight for the sector.

“We lose $2.3 billion annually to illegal, unreported and unregulated (IUU) fishing. We lose mangroves and young lives at sea. Without law, there is no Blue Economy; there is only blue anarchy,” he said.

Dr. Kiyaramo noted that the proposed Caucus is modelled after the East African Legislative Assembly (EALA), which governs Lake Victoria for seven countries.

“If EALA can govern Lake Victoria, the Nigerian Senate can govern the Gulf of Guinea front,” he stated.

He said the NSBEC is anchored on ABER’s vision of a connected, competitive and community-owned Blue Economy where no fisherfolk is left behind.

According to him, the Caucus, when established, could canvass for the Domestication of the AU Blue Economy Strategy, the Lomé Charter, ILO Convention C188 and the FAO Port State Measures Agreement; Legislation and enforcement of the 5-nautical-mile Artisanal Exclusive Zone;
Allocation of at least 10% of marine revenue to artisanal infrastructure; and Rallying South-South States to establish Ministries of Marine and Blue Economy, emulating the Bayelsa model.

Proposed Structure

Kiyaramo recommended a 23-member Caucus comprising two Senators each from Akwa Ibom, Bayelsa, Cross River, Delta, Edo and Rivers (12), plus Lagos, Ondo and Ogun (6), three non-littoral experts, and two ex-officio members from the Federal Ministry of Marine and Blue Economy and ABER as Technical Secretariat. Senator Imasuen is proposed as Chairman and Patron, with a minimum 35% women representation.

Four Standing Sub-Committees are proposed: Fisheries, Aquaculture and Blue Food Security; Blue Tourism, Marine Transport and Coastal Infrastructure; Blue Justice, Human Rights and Gender – to work with the International Human Rights Protection Service (IHRPS Forum) West Africa Envoy to track violations, provide legal aid, ensure women’s cold-chain ownership and enforce Free, Prior and Informed Consent (FPIC); and Blue Carbon, Mangroves and Climate Resilience – with 70% of benefits accruing to coastal communities.

The Caucus is also expected to initiate three landmark Bills: the National Blue Economy Act, the Artisanal Fisheries Protection and 5nm Enforcement Act, and the Blue Carbon and Mangrove Protection Act, while partnering with EALA, the ECOWAS Parliament and the Directorate of Technical Cooperation in Africa (DTCA).

90-Day Action Plan

Dr. Kiyaramo further proposed a 90-day take-off plan including inauguration by the Senate President, engagement with the South-South Governors Forum, a Public Hearing on the Blue Justice Gap and unveiling of 100 Bankable Blue Deals, and a Senate Motion on ILO C188 ratification and 5nm enforcement.

“The Caucus will harmonize blue laws, redirect IUU losses to community jobs and position Nigeria to lead the ECOWAS Blue Parliamentary Network,” he said.

“Like EALA governs Lake Victoria for seven countries, NSBEC can govern the Gulf of Guinea for Nigeria. History will not remember us for the oil we extracted, but for the ocean we preserved.”

The high point of the visit was the decoration of Senator Neda Imasuen as Patron of the Africa Blue Economy Roundtable by H.E. Dr. Mrs. Ezeadili Appolonia Obiageri. Hajiya Medina Dauda Nadabo, Director of Communication and Public Affairs of ABER, was part of the Convener’s entourage.

Signed:
Medina Dauda Nadabo Director Communications Public Affairs.

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Business & Economy

570% Fuel Price Increase: Take Cue From Us -ADC Tells Voters — Says Cost of Living Remains Central in January Elections

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By George Mgbeleke

The African Democratic Congress (ADC) has said that the outcome of the recent United States midterm elections, in which Americans voted to replace the ruling Republican Party in Congress amidst a nearly 37 per cent increase in fuel prices in several states, points the way for Nigerian voters grappling with a 570 per cent increase in petrol prices since President Bola Tinubu removed fuel subsidies in May 2023.

Earlier, the opposition party had urged Nigerians to emulate the Americans in the immediate aftermath of the US midterm elections, in which the ruling Republican Party suffered a crushing defeat. But as the shockwaves of the election continue to reverberate across the world, the party has now claimed that the outcome of the US election confirms its own position that the cost of living and affordability have become major issues in determining electoral outcomes, urging Nigerians to take a cue from this as the country heads to the polls in January.

“The lesson from America is simple: governments must answer to the people for their economic decisions. In January, the cost of living must be at the centre of Nigeria’s democratic choice,” the party said in a statement issued by its National Publicity Secretary, Mallam Bolaji Abdullahi, on Saturday.

“On Tuesday, American voters were responding to fuel-price increases of about 37 per cent. Nigerians have experienced a far steeper increase, with average petrol prices rising from N238.11 per litre in May 2023 to N1,596.25 by May 2026, translating to about a 570 per cent increase.”

The party explained that an increase of 570 per cent in petrol prices is not just an economic statistic, but the reason transportation has become unaffordable, food prices have risen and small businesses are struggling to survive.

“Every Nigerian household is paying the price for the APC and Tinubu’s failed policies,” the statement said, adding that while the government has continued to ask Nigerians to make sacrifices for a better future, more than three years later, the government has failed to show how the removal of subsidies could possibly benefit ordinary citizens.

“As January 16 approaches, Nigerians deserve clear answers about how fuel, electricity, food and transportation would be made affordable. The APC and President Tinubu clearly do not have answers. It is for the same reason that Americans voted against the ruling Republican Party, and it is for the same reason that Nigerians should reject the ruling APC in January,” the party said.

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