By Nairaland Forum STATE HOUSE PRESS RELEASE
HOW FG WILL TAX PROFITS MADE BY GLOBAL TECH, DIGITAL GIANTS IN NIGERIA, BY OSINBAJO
*VP explains enabling provisions in Finance Act
*Interacting with Chartered Institute of Taxation members, Osinbajo says no tax increases contemplated for now
*CITN to VP: We acknowledge your great zeal
Nigeria is set to utilize its legal provisions that empower the Federal Government to collect taxes on profits made in the country by global technology and digital firms not based in the country, but with significant economic presence here.
While the Federal Government will not be raising tax rates at this time, based on the Finance Act 2019, it is already empowered to widen the tax net, including by collecting taxes on the Nigerian income of global tech giants with significant economic presence here, even if they have not established an office or permanent establishment and are currently not paying taxes in Nigeria.
In this regard, Section 4 of the Finance Act 2019, provides that “the Minister (Finance) may by order (of the President) determine what constitutes the significant economic presence of a company other than a Nigerian company.”
Vice President Yemi Osinbajo, SAN, hinted at these issues and others while interacting with a delegation of the Chartered Institute of Taxation of Nigeria, CITN, led by its President, Mr Adesina Adedayo who visited him at the Presidential Villa on Friday.
According to Prof. Osinbajo, “we have had severe economic downturns which of course implies that we may not be able to collect taxes with the aggressiveness that would ordinarily be expected.
“I think the most important thing is that we must widen our tax net so that more people who are eligible to pay tax are paying. Several efforts have been made, and I am sure you are aware of the initiatives including the Voluntary Assets and Income Declaration Scheme (VAIDS) which was also an attempt to bring more people into the tax net, including those who have foreign assets.”
Continuing, the VP said “we have also recently taken a step with respect to a lot of the technology companies that are not represented here but who do huge volumes of business here.
“The Finance Act has shown that we are very prepared to ensure that these big technology companies do not escape without paying their fair share of taxation in Nigeria. Many of them do incredible volumes here in Nigeria and Read More
Source:: Nigerian Chatter