Headlines
FG Grants Dangote, Honeywell, Others Tax Reliefs and Concessions Worth N16tn – Report
The Federal Government has foregone N16.76tn in revenue to tax reliefs and concessions given to large companies between 2019 and 2021, according to findings by The PUNCH.
As of the end of 2021, 46 companies had benefitted from various tax incentives and duty waiver schemes while the requests of 186 companies were still pending.
These were contained in the tax expenditure statement (TES) reports in the Medium-Term Expenditure and Fiscal Strategy documents posted on the website of the Budget Office of the Federation.
The TES deals with revenue forgone on Company Income Tax, Value Added Tax, Petroleum Production Tax, and Customs Duty.
In the TES report for 2019, it was stated that the Federal Government had forgone revenue of N4.2tn from two main sources, CIT and VAT.
For CIT, the estimated amount of revenue forgone was N1.1tn while N3.1tn was for VAT.
The TES report read, “The most significant conclusion is the large size of Nigeria’s revenue forgone from just two of the main taxes, i.e., CIT and VAT. Nigeria’s non-oil revenue potential is at least twice its current collections.
“The preliminary estimate of revenue forgone from CIT incentives and concessions in 2019 is N1.1tn; for contrast, 2019 CIT collections was N1.6tn. The preliminary estimate of revenue forgone from VAT policy choices and compliance gaps is estimated to be NGN 3.1tn and could possibly be more. It is worth reiterating that revenue forgone from Customs Duty, Excises, Petroleum Production Tax, Personal Income Tax and concessions under the Oil and Gas Zones legislation is still to be computed.”
According to the TES report, the figure for revenue foregone would likely exceed N4.2tn if there were sufficient data, especially from Customs Duty, Excises, PPT, Personal Income Tax and concessions under the Oil and Gas Zones legislation.
By 2020, the figure rose to N5.8tn, with majority of it coming from revenue forgone under VAT. A breakdown showed that N4.3tn was forgone under VAT; N457bn under CIT; N307bn under PPT, and N780bn under customs duty.
It was also noted that five countries accounted for about 86 per cent of total customs relief, with China accounting for nearly two-thirds of total relief granted. Netherlands, Togo, Benin and India were the other top sources of supplies benefitting from the reliefs.
The total figure continued to rise in 2021, hitting N6.79tn, with revenue foregone on VAT accounting for most of it. A breakdown showed that N3.87tn was forgone under VAT, N548.40bn under CIT; N337.70bn under PPT; N1.84tn under customs duty; and N111.15bn under imports VAT.
For the three-year period, therefore, the Federal Government had to forgo a total of N16.79tn in tax reliefs, Customs duty waivers and concessions, according to an analysis by The PUNCH.
Under this figure, tax exemptions covered imported goods covered by diplomatic privileges, military hardware, fuels and lubricants, hospital and surgical equipment, aircraft (their parts and ancillary equipment), plant and machinery imported for use by companies in export processing zones, health and medical supplies to abate the spread of COVID.
Other exemptions included: reliefs on the presidential initiative on COVID-19 supplies, Import Duty and VAT on commercial airlines.
It was also noted that five countries accounted for about 92 per cent of total Customs relief with China accounting for nearly half of the total relief granted. Singapore, Netherlands, Togo, Benin Republic and India were the other top sources of supplies benefitting from the reliefs.
Meanwhile, the beneficiaries of the tax reliefs and concessions included Dangote, Lafarge, Honeywell and 43 other major beneficiaries.
As of the end of 2021, 46 companies had benefitted from the tax incentive scheme while the requests of 186 companies were still pending.
They were beneficiaries of the pioneer status tax relief under the Industrial Development Income Tax Act with tax reliefs for a three-year period.
This was contained in the Q4 2021 PSI report released by the Nigeria Investment Promotion Commission.
The pioneer status is an incentive offered by the Federal Government, which exempts companies from paying income tax for a certain period. This tax exemption can be full or partial.
The incentive is generally regarded as an industrial measure aimed at stimulating investments in the economy.
The products or companies eligible for this pioneer status are those that do not already exist in the country.
These companies included: Dangote Sinotrucks West Africa Limited, Lafarge Africa Plc, Honeywell Flour Mills Nigeria Plc, Jigawa Rice Limited, and Stallion Motors Limited.
Others included: African Foundries Limited, Royal Pacific Group Limited, Kunoch Hotels Limited, Princess Medi Clinics Nigeria Limited, Medlog Logistics Limited, and Masters Liquefied Gas Limited.
The Punch
Super Eagles winger, Ademola Lookman, has been named the CAF Footballer of the Year for the past year.
Lookman was announced as the winner at an elaborate event in Marrakech, Morocco on Monday night.
The Atalanta star won the prize ahead of Ivory Coast’s Simon Adingra and PSG’s Achraf Hakimi, Guinea striker Serhou Guirassy and South Africa goalkeeper Ronwen Williams.
It has been an incredible year for Lookman, who became the first player to score a hat-trick in the Europa League/UEFA Cup final since 1975, netting the three goals within 26 minutes against Bayer Leverkusen.
Lookman was included in the Team of the Year for the Europa League, and ended the season having had a direct hand in 18 top flight goals for La Dea.
The 27-year-old was ranked the 14th best player during the Ballon d’Or gala on October 28.
President Bola Tinubu has once again pleaded with Nigerians to to endure the hardship and pains his reforms and policies have inflicted on them, promising that his administration has its hands on the plough to quickly alleviate their sufferings.
Tinubu gave the assurance on Saturday, during the 48th convocation ceremony of Obafemi Awolowo University (OAU), Ile-Ife, Osun State, emphasising that his government would ensure that every citizen benefits, by correcting the mistakes of past administrations, promising not to engage in blame games but commit to improving the country through his economic reforms.
The president, who was represented at the event by the Special Adviser on Economy, Office of the Vice President, Tope Fasua, acknowledged that he is aware of the harsh economic situation of the country, and begged Nigerians to endure what he described as unintentional hardship, adding that he does not take pleasure in inflicting pains on Nigerians but assured there was light at the end of the tunnel as his reform policies were aimed at making Nigeria works for everyone.
“Fellow Nigerians, I am not unaware of the harsh economic situation of our country neither do I take pleasure in inflicting pains and anguish on my compatriots,” the President said in his keynote address at the convocation.
“However, we were faced with the stark reality of the results of some policies hitherto executed by past administrations but which had no direct positive impact on the generality of our people.
“Our reform policies are aimed at making Nigeria work for everyone, but the pains that come with the reform must be endured in the meantime.
“We have gladly accepted the assets and liability of our heroes’ past without any intention of apportioning blame or pointing an accusing finger at any individual or group of people.
“As we are trying to fix, reconfigure, and correct past mistakes and errors, we implore all Nigerians to cooperate with us, to endure this unintentional hardship so that; like the graduates of today, we all can celebrate and be celebrated at the end of the day. I am certainly seeing the light at the end of our tunnel.”
The Swedish Prosecution Authority announced today that the inquiry into rape allegations against French footballer Kylian Mbappé has been closed due to a lack of sufficient evidence to proceed.
This is according to multiple reports on Thursday morning.
The allegations had drawn international attention, casting a shadow over the football star’s career.
Mbappé, who had consistently denied the allegations, has yet to make an official statement regarding the decision
His legal team had previously emphasised his commitment to due process.
Mbappe was “linked to rape investigation in Sweden” and that he intended to reserve any explanations for the Swedish justice system “if necessary,” according to his lawyer, Marie-Alix Canu-Bernard.
“He prioritises providing his explanations, if required, to the Swedish judiciary,” Canu-Bernard told AFP, while strongly condemning “media allegations suggesting that Kylian Mbappé had commented on the events of his trip to Stockholm.”
The case, which began earlier this year, involved accusations stemming from an alleged incident in Stockholm. The prosecutor’s decision not to press charges marks the end of months of scrutiny and speculation.
