Business
VAT Rate May Increase
The Value Added Tax (VAT) may be increased in an attempt by the Federal Government to harmonise Nigeria’s Value Added Tax (VAT) Act with the Economic Community of West African States (ECOWAS) directives.
At the moment, Nigeria’s VAT rate is less than one per cent to its Gross Domestic Product (GDP).
The initiative to adjust the VAT came to the fore, Tuesday, in Abuja at a three-day workshop on Nigeria’s VAT Law, organised by the ECOWAS Commission under the context of implementation of the Support Programme for Tax Transition in West Africa (PATF).
At the parley, the government said the country’s VAT performance was the lowest in the West African region, describing the development as worrisome.
PATF is geared towards improving the management of domestic taxation and ensuring better coordination in ECOWAS and West African Economic and Monetary Union (WAEMU) regions.
Director, Tax Policy, Federal Ministry of Finance, Budget and National Planning, Basheer Abdulkadir, said exemptions of VAT in Nigeria were not aligned with those of ECOWAS.
In the meantime, companies that were unable to file their Companies Income Tax returns for this Year of Assessment (YOA) that fell due on June 30, 2023 have been given up to August 31 to submit their returns to the Federal Inland Revenue Service (FIRS).
The FIRS, in a statement signed by Johannes Oluwatobi Wojuola, Special Assistant (Media and Communication) to the Executive Chairman, stated that it had “received numerous calls from companies requesting for the extension of time to submit their Companies Income Tax (CIT) returns as they were unable to meet up with the deadline due on June 30, 2023”.
The FIRS noted that it agreed to extend the deadline for submission of CIT returns to companies “as a measure of goodwill and in line with relevant provisions of the Companies Income Tax Act.
“All companies whose CIT returns for 2023 year of assessment that fall due between June 30 and August 31, 2023 (both days inclusive) are given up to August 31 to submit the returns to the FIRS”.
On the VAT, Abdulkadir called for the exemption of few products, goods and services so that poor households could benefit from the policy.
He also called for the need to allow for tax input credit for intermediate and capital expenditure.
“Our VAT performance or rate is still one of the lowest. Nigeria has a VAT of less than one per cent to the GDP and this is worrisome.
“Also, we have the lowest VAT within the sub-region with an average of 16 per cent, while VAT rate in Nigeria is 7.5 per cent. So we need a lot of policy changes on tax administration as we also need to come up with strategies to address some of these issues”, he stated.
He said the exemptions of VAT in Nigeria are not aligned with those of the ECOWAS and we know that these exemptions are some of the issues that have to do with revenue mobilisation under the VAT.
Also speaking, Director of VAT, Federal Inland Revenue Service (FIRS), Lovette Onanuga, stated that VAT has the potential to raise a significant amount of revenue for the government.
Onanuga, while reiterating Nigeria’s commitment to ensuring the success of the PATF programme, described the workshop as timely.
“These three days’ workshop is very important. For example the study of the Harmonisation of Nigeria’s VAT Act with ECOWAS Directives will contribute to establishing coherence in the domestic systems of taxation and the realisation of the attainment of a common market and the Evaluation of VAT Performance will enable us to look more deeply into issues that will help improve VAT revenue collections”, she said.
ECOWAS Director of Customs Union and Taxation, Salifou Tiemtore, called on the government to put in place an appropriate institutional framework before the commencement of the implementation of the initiative.
Tiemtore, who was represented by Felix Kwakye, stressed the need for the evaluation of VAT performance, adding that the measure will outline issues that need to be addressed by the government of Nigeria to improve VAT revenue collections.
Oluwatobi Wojuola also assured companies that “the relevant Companies Income Tax returns will not attract late filing penalties or interests if payments were made on or before 31st August 2023.
He, however, warned that “where companies fail to file by the extended date, the penalty and interest for late payment will be computed from the original due date”.
According to Wojuola, “the relevant CIT returns shall, therefore, not attract Late Filing Penalty or interest for late payment if submitted to the Service on or before 31st August 2023.
“Where relevant CIT returns are not filed by the extended date, penalty and interest for late payment shall be computed from the original due date and not the extended date”.
The Service added that the grace period extended to companies to file their CIT returns does not cover “returns for withholding tax, value added tax, personal income tax (PAYE), among others.
Wojuola appealed to companies “to take the opportunity afforded by this extension to submit their CIT returns within the specified time, pay the taxes due and avoid payment of penalty and interest”.
MoniePoint Inc. a digital financial firm in Nigeria, has said it is empowering community pharmacists across the country with innovative payment solutions to improve access to drugs.
The financial firm said it had also provided loans for pharmacists under the aegis of the Association of Community Pharmacists of Nigeria (ACPN) to drive healthcare delivery in the country.
MoniePoint in a release titled, “Inside Nigeria’s community pharmacies: How Moniepoint drives healthcare access with payments and funding”, has reaffirmed its commitment to providing digital payment solutions to improve health outcomes in Nigeria.
The release examined how community pharmacies play a crucial role as vital access points for medical care in Nigeria, especially in areas with limited hospital or clinic access.
According to the release, the ACPN National Chairman, Ambrose Igwekwam, highlighted the critical role played by community pharmacies in Nigeria’s healthcare system over the years.
Igwekwam, however, expressed concerns over the challenges confronting the nation’s pharmaceutical industry which he said was hindering access to affordable medicines.
The pharmacist listed poor infrastructural systems, power, transportation, regulatory bottlenecks, importation dependency, and limited research opportunities as major challenges facing the pharmaceutical sector.
He also stressed the need for robust collaborative efforts with institutions like Moniepoint to strengthen the sector.
“As Nigeria continues to grow, improving local pharma manufacturing to meet the demands of this growth presents a key opportunity for us all.
“There is also the African Continental Free Trade Area Agreement, which is expected to boost our industry, especially when we start producing our drugs locally, which will provide the much needed foreign exchange from exports.
“We are also seeing advancements in digital health and technology which would hopefully deepen the practice of e-prescription in Nigeria”, the ACPN boss said.
Corlins Walter
In order to enhance customer service and streamline operations, the Chartered Insurance Institute of Nigeria (CIIN) has called on stakeholders in the insurance industry to embrace Artificial Intelligence (AI).
The President of the institute, Yetunde Ilori, made this call at the 2024 Office Representatives Committee (ORC) Workshop, organised by the institute, with the theme “AI and the Future of the Insurance Industry”, in Lagos.
Ilori at the event, emphasised the importance of AI adoption, noting that it was not a threat to jobs but rather a tool to improve efficiency across the insurance sector.
“It is not about AI taking over our jobs, but about us using AI to simplify processes and give maximum satisfaction to all the customers we serve whether as underwriters, brokers, loss adjusters, or in educating our members”, she said.
The workshop, which brought players in the insurance sector together, aimed to address how AI could be leveraged to transform business processes and improve customer interactions.
The Chairman of the ORC, Monica Nwachukwu, underscored the role of AI in modernising the industry, adding, “AI can automate customer and claims processes, allowing insurers to provide faster and more efficient services to their customers”.
She explained how AI could help extract data from legacy systems, enhancing decision-making processes.
“By integrating AI with APIs, insurers can feed valuable data into AI solutions to improve operations and customer service”, she added.
In his address, the Managing Partner of A4S and Training Heights, Orlando Odejide, stressed the need for companies to align their strategies with future technologies like AI, especially as they prepare for 2025.
“Any organisation that wants to grow into the future must have its strategic plan in place. If your strategy for 2025 is not ready, it should be done by October”, he advised.
He encouraged participants to think critically about how AI could be integrated into their business models to ensure they remain competitive.
“The idea is for you to use this workshop as a platform to think about your organization and how AI can help streamline your processes and improve growth”, Odejide noted.
In order to gain global respect and recognition, the National Space Research and Development Agency (NASRDA) has reaffirmed its determination to pursue its goal in ensuring that Nigeria’s space capabilities are recognised on the world stage.
The agency also reaffirmed its commitment to positioning Nigeria as a key player in the global space economy.
In a statement by the Director of Media and Corporate Communications, Dr. Felix Ale, NASRDA revealed that the Director-General of the agency, Matthew Adepoju, emphasised this during recent engagements at the 79th United Nations General Assembly and the Nigerian Association of Chambers of Commerce, Industry, Mines and Agriculture (NACCIMA) and Global Alliance Business Association international conference in Michigan, United States.
The statement noted that Adepoju outlined a forward-thinking agenda, stressing the importance of Nigeria’s space programme as a leader in research, exploration, and technological innovation.
“Our goal is to ensure that Nigeria’s space capabilities are recognised on the world stage.
“We must foster collaborations with global space agencies to enhance our satellite capabilities and technological infrastructure”, he stated.
The NASRDA boss said the agency is focusing on enhancing satellite capabilities, expanding international collaborations, and leveraging space science for national development.
He said NASRDA will have no stone unturned in pursuit of excellence, ensuring the agency secures the necessary resources and recognition to propel it forward.
“The relationships we build today will pave the way for tomorrow’s advancements in space science.
“Innovation and progress thrive in an environment built on collaboration and inclusivity”, he stated.
He emphasised that with the support of the government, international partners, and a dedicated team, NASRDA is poised to make significant strides in the evolving global space landscape.
“We are on the brink of a new era for Nigeria’s space agency. Together, we will ensure our nation stands out in the global space economy”, he said.
Corlins Walter