Global

Details

  • Service: Tax, International Corporate Tax, Global Compliance Management Services
  • Type: Regulatory update
  • Date: 10/16/2012

Nigeria - Tax incentives for employment, infrastructure development 

October 16:   An order issued by Nigeria’s president (made public on 4 October 2012) provides tax incentives for companies doing business in Nigeria.

The incentives are in the form of exemptions from tax—not tax credits—and are intended to encourage employment and infrastructure development in Nigeria. Under the incentives, three categories of tax relief—employment tax relief, work experience acquisition programme relief, and infrastructure tax relief—are specified.


Under the employment tax relief measures, a company generally may be eligible for an exemption from companies income tax up to 5% of assessable profits in an assessment period (tax year).


Concerning the infrastructure tax relief provision, the exemption from companies income tax is 30% of costs incurred in providing infrastructure or facilities of a “public nature.”


The order—Companies Income Tax (Exemption of Profits) Order, 2012—was issued by the president in April 2012 as an exercise of authority under section 23(2) of the Companies Income Tax Act, but it was only recently made public.


The order has an effective date of 27 April 2012 and will be effective for five years.


Read an October 2012 report [PDF 482 KB] prepared by the KPMG member firm in Nigeria: Companies Income Tax (Exemption of Profits) Order, 2012




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