Nigeria’s economic stabilisation agenda can only be achieved through clear legislation, consistent regulatory enforcement, and meaningful stakeholder collaboration, according to tax professionals.
The experts, who spoke at the fourth virtual edition of the Economic Stabilisation Bill forum, organised by the Chartered Institute of Taxation of Nigeria, highlighted the importance of tax reforms in strengthening Nigeria’s revenue base while maintaining a favorable investment climate.
The proposed tax reforms aim to align with existing tax frameworks such as the Petroleum Industry Act, Petroleum Profits Tax Act, and Deep Offshore and Inland Basin Production Sharing Contracts. These structures aim to create a balance between government revenue generation and incentives for petroleum sector investors.
– Compliance with Tax Laws: Upstream petroleum companies must remain compliant with tax laws and strategically optimise deductions to reduce liabilities.
– Accurate Financial Records: Businesses must maintain accurate financial records and seek expert guidance in tax planning to avoid unnecessary financial exposure.
– Tax Audits: Tax audits play a crucial role in ensuring transparency and accountability within the oil and gas sector.
– Stakeholder Collaboration: Consistent regulatory enforcement and a collaborative approach among stakeholders are key to sustaining economic reforms and boosting investor confidence.
The Federal Government has demonstrated its commitment to tax reforms through the appointment of a Presidential Committee on Fiscal Policy and Tax Reforms, chaired by Mr. Taiwo Oyedele. The committee is responsible for designing and implementing tax reforms that will transform Nigeria’s tax system and support sustainable development.
Nigeria’s tax system faces several challenges, including multiple taxes, low tax morale, and high prevalence of tax evasion. However, the proposed tax reforms present an opportunity for Nigeria to strengthen its revenue base, promote economic growth, and improve its investment climate.
The proposed tax reforms are expected to have several benefits, including:
– Increased Revenue: A more efficient tax system will increase revenue generation for the government.
– Improved Investment Climate: A favorable tax environment will attract more investments into the country.
– Economic Growth: A stronger revenue base will enable the government to invest in critical infrastructure and promote economic growth.
– Job Creation: A growing economy will create more job opportunities for Nigerians.
The proposed tax reforms present a critical opportunity for Nigeria to transform its tax system and support sustainable development. The government must work with stakeholders to ensure that the reforms are implemented effectively and that the benefits are shared equitably among all Nigerians. With the right tax reforms in place, Nigeria can strengthen its revenue base, promote economic growth, and improve its investment climate.