๐1 – ๐๐ก๐ฒ ๐ข๐ฌ ๐ญ๐ก๐ ๐ ๐จ๐ฏ๐๐ซ๐ง๐ฆ๐๐ง๐ญ ๐ฌ๐๐๐ค๐ข๐ง๐ ๐ญ๐จ ๐๐ฆ๐๐ง๐ ๐ญ๐ก๐ ๐ญ๐๐ฑ ๐ข๐ง๐๐๐ง๐ญ๐ข๐ฏ๐๐ฌ ๐๐ฏ๐๐ข๐ฅ๐๐๐ฅ๐ ๐ญ๐จ ๐๐ซ๐๐ ๐ณ๐จ๐ง๐ ๐๐ง๐ญ๐ข๐ญ๐ข๐๐ฌ ๐๐ฌ ๐ฉ๐๐ซ๐ญ ๐จ๐ ๐ญ๐ก๐ ๐ญ๐๐ฑ ๐ซ๐๐๐จ๐ซ๐ฆ ๐๐ข๐ฅ๐ฅ๐ฌ?
A1 – The tax bills are part of the comprehensive reform of the tax system. The key objectives include harmonisation of tax rules, rationalisation of tax incentives, and addressing distortions or impediments to business growth. In this regard, all relevant tax laws, tax policies, regulations and incentive regimes including the free zones are under review.
๐2 – ๐๐ซ๐ ๐๐ซ๐๐ ๐ญ๐ซ๐๐๐ ๐ณ๐จ๐ง๐๐ฌ ๐ง๐จ๐ญ ๐ฆ๐๐๐ง๐ญ ๐ญ๐จ ๐๐ ๐ญ๐๐ฑ ๐๐ซ๐๐, ๐ฐ๐ก๐๐ญ ๐ฐ๐ข๐ฅ๐ฅ ๐๐ก๐๐ง๐ ๐?
A2 – Approved enterprises are exempt from all taxes on their approved activities within the zones and with respect to exports. The Nigeria ๐๐ฑ๐ฉ๐จ๐ซ๐ญ Processing Zones and the Oil & Gas ๐๐ฑ๐ฉ๐จ๐ซ๐ญ Free Trade Zones were established to promote exports. This is clear from the enabling laws and as contained in the Third Schedule to the NEPZA Act where the first approved activity is stated as โ๐ฎ๐ข๐ฏ๐ถ๐ง๐ข๐ค๐ต๐ถ๐ณ๐ช๐ฏ๐จ ๐ฐ๐ง ๐จ๐ฐ๐ฐ๐ฅ๐ด ๐ง๐ฐ๐ณ ๐ฆ๐น๐ฑ๐ฐ๐ณ๐ตโ. Other approved activities relate to international services, transshipment and services within the zones. For instance, banking is listed as an approved activity but it does not mean that a bank can set up in the zone and render banking services across Nigeria without paying taxes, rather it refers to banking within the zone or for exports.
๐3 – ๐๐ข๐ฅ๐ฅ ๐ญ๐ก๐ข๐ฌ ๐ง๐จ๐ญ ๐๐ฆ๐จ๐ฎ๐ง๐ญ ๐ญ๐จ ๐ ๐ซ๐๐ฏ๐๐ซ๐ฌ๐๐ฅ ๐จ๐ ๐ญ๐ก๐ ๐ญ๐๐ฑ ๐ข๐ง๐๐๐ง๐ญ๐ข๐ฏ๐๐ฌ ๐ฐ๐ก๐ข๐๐ก ๐๐จ๐ซ๐ฆ๐๐ ๐ญ๐ก๐ ๐๐๐ฌ๐ข๐ฌ ๐๐จ๐ซ ๐ญ๐ก๐ ๐ข๐ง๐ฏ๐๐ฌ๐ญ๐ฆ๐๐ง๐ญ๐ฌ ๐ฆ๐๐๐ ๐๐ฒ ๐ญ๐ก๐ ๐๐ฉ๐ฉ๐ซ๐จ๐ฏ๐๐ ๐๐ง๐ญ๐๐ซ๐ฉ๐ซ๐ข๐ฌ๐๐ฌ ๐ญ๐ก๐๐ซ๐๐๐ฒ ๐๐ข๐ฌ๐๐จ๐ฎ๐ซ๐๐ ๐ข๐ง๐ ๐ข๐ง๐ฏ๐๐ฌ๐ญ๐ฆ๐๐ง๐ญ ๐ข๐ง ๐ญ๐ก๐ ๐ณ๐จ๐ง๐๐ฌ?
A3 – No. Section 8 of the enabling laws covers exemption from taxes as stated below:
โ๐๐ฑ๐ฑ๐ณ๐ฐ๐ท๐ฆ๐ฅ ๐ฆ๐ฏ๐ต๐ฆ๐ณ๐ฑ๐ณ๐ช๐ด๐ฆ๐ด ๐ฐ๐ฑ๐ฆ๐ณ๐ข๐ต๐ช๐ฏ๐จ ๐ฐ๐ข๐ญ๐ก๐ข๐ง ๐ข ๐ก๐ฐ๐ฏ๐ฆ ๐ด๐ฉ๐ข๐ญ๐ญ ๐ฃ๐ฆ ๐ฆ๐น๐ฆ๐ฎ๐ฑ๐ต๐ฆ๐ฅ ๐ง๐ณ๐ฐ๐ฎ ๐ข๐ญ๐ญ ๐๐ฆ๐ฅ๐ฆ๐ณ๐ข๐ญ, ๐๐ต๐ข๐ต๐ฆ ๐ข๐ฏ๐ฅ ๐๐ฐ๐ท๐ฆ๐ณ๐ฏ๐ฎ๐ฆ๐ฏ๐ต ๐ต๐ข๐น๐ฆ๐ด, ๐ญ๐ฆ๐ท๐ช๐ฆ๐ด ๐ข๐ฏ๐ฅ ๐ณ๐ข๐ต๐ฆ๐ด.”
Sales to the domestic market (referred to as “customs territory”) is neither an approved activity nor is it within the zones.
Also, section 18(1)(e) stated below which permits the sale of goods and services to the customs territory does not confer tax exemption. Rather, it is a regulatory concession without which an approved enterprise would be prohibited from selling its goods and services to the customs territory regardless of whether taxes will be paid or not.
“๐.18(1)(๐ฆ) ๐ถ๐ฑ ๐ต๐ฐ ๐ต๐ธ๐ฆ๐ฏ๐ต๐บ-๐ง๐ช๐ท๐ฆ ๐ฑ๐ฆ๐ณ ๐ค๐ฆ๐ฏ๐ต ๐ฐ๐ง ๐ฑ๐ณ๐ฐ๐ฅ๐ถ๐ค๐ต๐ช๐ฐ๐ฏ ๐ฎ๐ข๐บ ๐ฃ๐ฆ ๐ด๐ฐ๐ญ๐ฅ ๐ช๐ฏ ๐ต๐ฉ๐ฆ ๐๐ถ๐ด๐ต๐ฐ๐ฎ๐ด ๐๐ฆ๐ณ๐ณ๐ช๐ต๐ฐ๐ณ๐บ ๐ข๐จ๐ข๐ช๐ฏ๐ด๐ต ๐ข ๐ท๐ข๐ญ๐ช๐ฅ ๐ฑ๐ฆ๐ณ๐ฎ๐ช๐ต ๐ข๐ฏ๐ฅ ๐ฐ๐ฏ ๐ฑ๐ข๐บ๐ฎ๐ฆ๐ฏ๐ต ๐ฐ๐ง ๐ข๐ฑ๐ฑ๐ณ๐ฐ๐ฑ๐ณ๐ช๐ข๐ต๐ฆ ๐ฅ๐ถ๐ต๐ช๐ฆ๐ด.”
โฆ
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