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Why Nigeria Did Not Sign The OECD Minimum Corporate Tax Agreement – FIRS

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Why Nigeria Did Not Sign The OECD Minimum Corporate Tax Agreement - FIRS

“Nigeria has been involved in various work-streams under the OECD project”

Olushola Okunlade Writes

The Federal Inland Revenue Service (FIRS) has explained why Nigeria did not sign the Organisation for Economic Cooperation and Development (OECD) G20 Inclusive Framework two-pillar solution to tax challenges of the digitalized economy.

The OECD G20 Inclusive Framework two-pillar solution proposes a framework of rules aimed at tackling base erosion and profit shifting and providing for the taxation of Multinational Enterprises (MNEs). Four member countries of the Inclusive Framework (Nigeria inclusive), out of 140, have not agreed to the Two-Pillar solution.

Nigeria’s reasons for not agreeing to the Two-Pillar solution was explained in a webinar session hosted by the FIRS last week.

Why Nigeria Did Not Sign The OECD Minimum Corporate Tax Agreement - FIRS
Mr. Muhammad Mamman Nami, Executive Chairman of the FIRS.

The Executive Chairman of the FIRS, represented by the Group Lead, Executive Chairman’s Group, Mr M. L. Abubakar, noted that taxation of the digital economy has become a topical issue that many economies and developmental blocs are working to solve, including the OECD and the United Nations Tax Committee who have commissioned projects to produce a common front for countries to adopt.

“Nigeria has been involved in various work-streams under the OECD project and had articulated its position on the technical work towards the goal of producing a common front for countries. However, our concerns on potential negative revenue returns that the rule designs would have for developing countries were unaddressed, Nigeria abstained from committing to the rules at this time.” He stated.

He explained that the webinar was therefore to educate the general public on the modalities and impact of the statement released by the OECD Inclusive Framework on the 8th of October 2021 and to provide a broad picture on why Nigeria abstained from signing.  

The webinar which was a special edition of the FIRS Taxpayer Engagement Series was hosted by Mr. Olufemi Olarinde, Technical Assistant (Tax Policy) to the Executive Chairman FIRS, while technical papers were delivered by Mr. Mathew Gbonjubola, Mr Temitayo Orebajo, Mr Kehinde Kajesomo, Mr, Emmanuel Eze and Ms. Aisha Isa, all staff of the FIRS.

Explaining in detail, Mr. Mathew Gbonjubola, the Group Lead Special Tax Operations Group, and Nigeria’s representative at the OECD Inclusive Framework highlighted that despite the expected outcome that both Pillars will increase Global Corporate Income Tax by as much as $150 Billion per annum, with an attendant favourable environment for investment and economic growth, there were serious concerns that the pillars did not address negative revenue outcome for Nigeria and other developing countries.

“The general issue that developing countries have with the outcome that was published on October 8th is the high cost of implementation. And that speaks to the complexities of the proposal in the inclusive framework statement. In every complex situation or rule, implementation and compliance will always be difficult. When implementation or compliance is difficult, there would be the high cost of implementation.

“Another issue was that the economic impact assessment that was carried out on Pillar 1 and 2 were founded on an unreliable premise. The country-specific impact assessment that was done was top-down. Somebody just looked at the GDP of Nigeria and says Nigeria’s GDP is this much and then they should be able to buy this number of shoes and things like that. And you and I know, in that kind of postulation, the margin of error is usually very wide. That exactly was what happened with this. Particularly for Nigeria, when we ran the numbers it was way off the figures that the OECD gave us.

“And the final issue most developing countries had was that the developed world, within the inclusive framework, was very indifferent to the concerns expressed by most developing countries. This you can see from the outcome, with respect to the complexity, issues of the high cost of implementation and on the issue of revenue accruable to developing countries. When you look at the bulk of the money that would accrue from the project, if any, 70% – 80% will go to the developed countries. Almost nothing comes to the developing countries.” He explained.

On the specific concerns raised by Nigeria, Mr. Gbonjubola, who led Nigeria’s team on the Inclusive Framework negotiations, explained that while the whole project started out to find solutions to the challenges of a digitalised economy the outcome was completely different.

He went further to note that the statement by the OECD Inclusive Framework required all parties to remove all Digital Service Taxes and other relevant similar measures with respect to companies taxation and to commit not to introduce such measures in the future.

“The statement required the withdrawal of unilateral measures by countries. Which Nigeria does not have a problem with (Nigeria does not have any unilateral measure targeted at digital services companies). However, the paper that was released on unilateral measures was so expansive in its definition that we are concerned that the taxing rights that Nigeria has always enjoyed may be withdrawn.”

He further explained that Nigeria is unable to implement the mandatory binding resolution on arbitration because of constitutional limitations as to tax dispute resolution.

He also stated that for Nigeria, “Pillar 2 is not a deal-breaker because Nigeria could work with Pillar 2. “We have a few issues with Pillar 2 but we could live with them but because Pillar 1 and 2 are a single package, since we are rejecting Pillar 1, we can’t take on Pillar 2”.

“Under the inclusive framework rule you either accept both Pillars or you reject both Pillars. You cannot pick one to the exclusion of the other. And since Nigeria is not able to join one of the pillars, it means we are out of both Pillars.”

Mr. Gbonjubola also stated that Nigeria does not see any additional revenue coming to by way of Pillar 2, though he added that it could act as a behaviour modifier for policy makers to take another look at the various tax incentives and tax waivers we have in our tax laws and begin to restructure them in other to ensure that we are not deliberately throwing away revenue.

“Nigeria could not sign up to the statement of the inclusive framework because it did not address the concerns that we had expressed as a country and it also did not take cognisance of issues around developing countries, which will make those outcomes not to provide additional revenue, and if any, very little, and at very significant cost.”

He further stated that Nigeria, which had participated in all the meetings of the working groups would continue to participate in the design of all technical notes and model rules, and would agree to the Pillars if its expressed concerns are addressed.

“And finally, just like the Honourable Minister of Finance said a couple of months ago, Nigeria would continue to participate in the inclusive framework activities particularly the design of all the technical notes and the model rules, and then, if and only if, the concerns we have expressed are addressed, then Nigeria still has the chance to join up and to sign up. But if not, we will leave that to our policymakers to decide going forward”

The Webinar had in attendance Prof. Abiola Sani, a professor of Commercial Law in Nigeria as well as other eminent tax practitioners and representatives of government and private institutions. The representatives of the Kenya and Zambia revenue authorities were also in attendance.

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Betamark Organises 2-Day Training For Entrepreneurs, SMEs On How To Make Yoghurt With Soy Powder

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Betamark Organise 2-Day Training For Entrepreneurs, SMEs On How To Make Yoghurt With Soy Powder

Betamark Organises 2-Day Training For Entrepreneurs, SMEs On How To Make Yoghurt With Soy Powder

Olushola Okunlade Writes

Betamark Production Company Limited has organised two 2-day training for entrepreneurs, SMEs in food production on how to start Soy Yoghurt with Soya Powder in Nigeria.

The soy yoghurt has appealed to the tastes of diverse cultures as most milk packaging companies in Nigeria have adopted soy powder technologies.

With the increasing awareness of the nutritional value of soy powder, ease of preparation and availability of the raw materials, the market is assured. It is everyone’s delicacy who has tasted it, especially school children, workers, oil and young.

Betamark Production Company Limited has teamed up with Spectra Industries to equip willing candidates with a two 2-day intensive training programme on 20-21 January 2022 aimed at supporting small businesses to grow in the food production sector.

Interested candidates are to pay #25,000 to BETAMARK PRODUCTION COMPANY ACCOUNT NUMBER- 0027947080 STANBIC IBTC BANK and send details of payment to betamarkindustries@gmail.com and for more details call 09033446662.

The training will hold at Plot 1, Suco Road, Oko-Oba, Agege, Lagos from Thursday 20 – Friday 21, January 2022.

Apart from the lucrative nature of this business, it is also rich in vitamins and helps to nourish the body. Invariably, you are nourishing the Nigerian society as you sell yoghurt to them.

The word “Yoghurt” is no longer a new term to many Nigerians as they have come to love ice cream because of its rich nutritional content and amazing soured milk taste, adding Soy Powder is another rich taste that any yoghurt lover cannot resist.

Yoghurts have become a choice for many Nigerians both kids and adults alike. It is not uncommon to see school children enjoy yoghurts with snacks like buns, chin-chin, sausage roll, eggroll, wheat, meat pie and other snacks.

This is not limited to children alone as adults do the same especially at workplaces and when they are travelling, thus making yoghurt marketing in Nigeria a very lucrative business venture to go into.

One of the ways to start soy yoghurt production in Nigeria is becoming interesting and is by not only limiting your business choice to yoghurts alone but also including other variants like soy powder.

The physical programme is a two 2-day training program that will provide business owners with supports to accelerate food production skills.

in food production

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Institute For Tourism Professionals Elected Otunba Ayo Olumoko As Zonal Vice President

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Institute For Tourism Professionals Of Nigeria Elected Otunba Ayo Olumoko As Zonal Vice President

…emulate Otunba Olumoko by remaining steadfast as its ambassadors in the promotion of its aims, says Chief Odusanwo

Olushola Okunlade Writes

The National President of the Institute for Tourism Professionals of Nigeria (ITPN), Chief Abiodun Odusanwo FITPN, has extolled the virtues of Otunba Ayodele Olumoko as a dedicated Fellow of the Institute who has put in his very best to place the Institute on a sound footing during his official induction as the National Vice President, SouthWest zone of ITPN.

Otunba Ayodele Michael Olumoko,  an astute Cultural heritage promoter, integrated marketing communications professional; his footprints at major festivals in Nigeria aimed at promoting cultural tourism can never be abdicated at festivals such as the Osun Oshogbo International Festival Oshogbo, Ojude Oba Festival, Ijebu Ode; Ebi-Epe Festival, Epe Lagos; Argungu International Fishing Festival Kebbi State just to mention a few.

His leadership qualities are impeccable and his network within the corporate circle is a factor that cannot be underestimated. He has served humanity meritoriously, a bonafide member, Past President of Rotary Club of Ikeja in Lagos State.

In the Tourism Sector dates back to 1999 he was appointed Chief Festival Consultant to the UNESCO listed Osun Osogbo Grove Festival, a position he held for 21 years before he was appointed the Cultural Consultant to the Ooni of Ile-Ife, a position which he still holds till date.

Otunba Ayodele Olumoko, Chairman of Infogem formed in I998, joined FTAN as an Associate (now Affiliate) Member following which he became the Chairman of the Lagos State Chapter between 2007 and 2010 and later became the Secretary of the South West region of FTAN.

Chief Abiodun Odusanwo who made the commendation while presenting the Certificate of Office to Otunba Ayo Olumoko at the Headquarters of the Institute in Abuja on Thursday 6th January 2022, said Otunba Ayodele Olumoko has been one of the founding fathers and promoters of culture and tourism in the country and whose contributions have impacted positively well on ITPN in the upliftment of its tenets and ideals for the growth of the institution.

Speaking further, Chief Odusanwo called on other members of the Institute to emulate Otunba Olumoko by remaining steadfast as its ambassadors in the promotion of its aims and objectives to the larger Nigerian society and importantly, to critical key players and stakeholders in the travel, tourism, culture, hospitality, and creative industry as well as its allied branches.

Institute For Tourism Professionals Of Nigeria Elected Otunba Ayo Olumoko As Zonal Vice President
LEFT-RIGHT: CHIEF ABIODUN ODUSANWO WHILE PRESENTING THE CERTIFICATE TO OTUNBA AYODELE OLUMOKO.
Institute For Tourism Professionals Of Nigeria Elected Otunba Ayo Olumoko As Zonal Vice President
Institute For Tourism Professionals Of Nigeria Elected Otunba Ayo Olumoko As Zonal Vice President
LEFT-RIGHT: CHIEF ABIODUN ODUSANWO WHILE PRESENTING THE CERTIFICATE TO OTUNBA AYODELE OLUMOKO.
Institute For Tourism Professionals Of Nigeria Elected Otunba Ayo Olumoko As Zonal Vice President
OTUNBA AYODELE OLUMOKO.
Institute For Tourism Professionals Of Nigeria Elected Otunba Ayo Olumoko As Zonal Vice President
OTUNBA AYODELE OLUMOKO.

He noted that ITPN has four major mandates which are – to develop and administer Qualifications; approve and monitor training centres and learning providers as certificate Awarding body; to provide continuous professional development for private sector operators and public service personnel and to award recognized certificates and membership for every category of staff at different levels of skills in the tourism, and allied areas of the industry.

In his acceptance speech, Otunba Olumoko said he felt highly honoured with the continuous call to professional service which according to him will spur him into offering greater and better services to the Institute in particular and the country’s travel, tourism, and hospitality industry at large.

He noted that tourism, especially cultural tourism remains, one of the country’s untapped goldmines that if properly harnessed, has the potential to lift millions of Nigerians out of poverty through job provisions and employment opportunities.

Otunba Olumoko then called on all key players and stakeholders in the industry to join hands with ITPN in its efforts to enhance professional practices and conducts of both private sector practitioners and public service personnel to enable the industry to provide better quality service delivery as well as help in salvaging Nigerian economy for better growth and development.

The Institute for Tourism Professionals of Nigeria is the Nigerian premier national certification and professional membership body for hospitality, travel-tourism and allied occupations. It represents members working in the public, private, and non-profit making organizations which ensures the highest standards of professional competence of practitioners in the Nigerian tourism and hospitality industry.

Institute For Tourism Professionals Of Nigeria Elected Otunba Ayo Olumoko As Zonal Vice President
Institute For Tourism Professionals Of Nigeria Elected Otunba Ayo Olumoko As Zonal Vice President

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BUA, Wartsila OY Of Finland Sign Agreement For Construction Of 70MW Power Plant For BUA Cement Sokoto Line 4

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BUA Cement Plc. Chairman, Abdul Samad Rabiu while signing the agreement with Wartsila Oy of Finland to build a 70MW power Plant for BUA Cement Sokoto Line 4.

Olushola Okunlade Writes

BUA Cement Plc has signed an agreement with Wartsila OY of Finland for the construction of a 70megawatts dual-fuel power plant for the BUA Cement Sokoto Line 4in Sokoto state, North-West Nigeria.

This announcement comes as BUA Cement recently revealed that it was looking to boost its production capacity in Nigeria over the next 3 years with new plants in the works.

In addition, this will be the second plant to be constructed by Wartsila for BUA Cement – the first being the BUA Cement Sokoto power plant scheduled to be commissioned alongside the plant in November 2021.

Speaking at the signing ceremony, Abdul Samad Rabiu, Chairman of BUA Cement Plc who signed on behalf of the cement producer said BUA Cement will continue to invest strategically in the West African Cement industry to enable it to bridge the huge infrastructure and housing deficit.

According to Rabiu, “BUA Cement is happy and pleased with the progress that Wartsila made with the construction of the power plant we initially purchased for our BUA Cement Sokoto Line 3 which we expect will begin commissioning by November alongside the power plant. We believe Wartsila will bring the same level of efficiency, technical expertise, and professionalism to bear in ensuring that this new power plant for the 3million Mtpa BUA Cement Sokoto Line 4 will be completed on schedule by the end of next year as we look towards bringing BUA’s total capacity in its Sokoto plant to 8 million metric tonnes by early 2023 and 17million metric tonnes across all its plants by the same time.”

BUA, Wartsila OY of Finland sign agreement for construction of 70MW Power Plant for BUACement Sokoto Line 4
BUA Cement Plc. Chairman, Abdul Samad Rabiu while signing the agreement with Wartsila Oy of Finland to build a 70MW power Plant for BUA Cement Sokoto Line 4.

On his part, Mark Thiriet, Energy Business Director at Wartsila West Africa said Wartsila was proud to partner with BUA Group on this BUA Cement Sokoto Line 4 project. He said that Wartsila will bring its technical expertise and globally recognized technology to bear in bringing the project to completion.

BUA Cement Plc is Nigeria’s second-largest cement company and the largest producer in its North-West, South-South, and South-East regions. BUA Cement operates strategically from Okpella, Edo State, and Kalambaina, Sokoto State with its headquarters in Lagos, Nigeria.

Currently the second most capitalized manufacturing company on the Nigerian Stock Exchange (NSE), BUA Cement is committed to quality – a differentiating attribute, driven by its people, innovation, and technology; and positioned to solve West Africa’s cement under capacity while driving economic growth and development.

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