Key highlights

• LCCI recommends the retention of the Tertiary Education Tax rate at 2.5 percent
• They said with the proposed increase to 3 percent, Nigeria’s corporate income tax rate would effectively rise to about 36 percent; one of the highest rates in the world.
• LCCI also urged recommended that finance bills are presented for extensive stakeholders’ consultations before the National Assembly passes them into law.

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The incoming administration should not increase taxes but explore measures to rescue expenditures.

This was disclosed by Dr. Michael Olawale-Cole, President, Lagos Chamber of Commerce and Industry (LCCI) on Tuesday during its second quarter State of the Economy conference held in Lagos, reported by News Agency of Nigeria.

LCCI noted that if FG leaves tax at the current rant, it will not lead to revenue losses, urging that with the FG’s proposed increase to 3%, Nigerian businesses would be paying the highest corporate income tax rate in the world.

Tax and Revenue

The report stated the LCCI Chief urged that FG should explore new ways of rescuing some tax expenditures to raise its revenue, instead of increasing taxes, citing that leaving the tax rates at their current levels will not lead to loss of revenue against what is proposed in the Finance Bill 2022, the report added:

• “Based on feedback from operators in the oil and gas sector and the wider business community, the chamber recommended the retention of the Tertiary Education Tax rate at 2.5 percent.
• “At the government’s proposed increase to 3 percent, Nigeria’s corporate income tax rate would effectively rise to about 36 percent; one of the highest rates in the world.
• “ The Federal Government to retain the 30 percent Company Income Tax for all oil and gas companies.

Petroleum Profit Tax Act

LCCI also urged FG to amend the Petroleum Profit Tax Act alongside provisions in the Petroleum Industry Act 2021, adding that due to divestments by some large corporations from Nigeria’s oil and gas sector, the government needed to reposition the industry through a steeply implemented PIA to pave the way for new investments, he also added:

• “We recommend that finance bills are presented for extensive stakeholders’ consultations before the National Assembly passes them into law.
• “The LCCI will continue to work toward rallying the private sector to support the implementation of the 2023 federal budget.
• “On achieving revenue targets, Ministries, Departments and Agencies, and government-owned enterprises can intensify their revenue mobilization efforts in an enabling environment where the private sector thrives.

LCCI also noted that for FG to achieve the laudable objectives of the 2023 budget, the government needs to sustain current efforts toward the realization of crude oil production and export targets.

On Naira redesign and circulation they urged CBN to obey and to implement to the letter, Supreme Court’s judgment that allowed old notes as legal tender till Dec. 31, adding that stakeholders must learn lessons from the redesign policy for hitch-free implementation with necessary infrastructure put in place for a truly cashless economy.

In case you missed it

Recall Nairametrics reported recently that Nigeria Employers’ Consultative Association (NECA) Director-General, Mr. Adewale-Smatt Oyerinde said any plan to increase Taxes to deal with Government deficit spending will weaken the purchasing power of individuals and stifle consumption.

He added that It may also overwhelm the Private sector and make the business community more vulnerable with a trade-off between growth and job creation.