On 28 November 2019, the House of Representatives passed the Finance Bill 2019. It was passed its third reading by the National Assembly on 21 November 2019. Major proposed amendments are given below:
- A lower (i.e. 20%) corporate income tax rate (CIT) applies for companies with turnover between NGN25-million and NGN100-million. However, businesses with a turnover below NGN25-million are to be exempted from CIT rate;
- Additional dividend other than profits are exempted from tax and franked investment income only to un-taxed distributions;
- Minimum tax provisions are amending to 0.5% of turnover;
- granting a bonus of 2% of tax payable to medium-sized companies and 1% to large companies for the early payment of companies income tax;
- introducing thin-capitalization requirements of an interest deduction is equivalent to 30% of EBITDA for loans received from non-resident associated parties, with any additional interest expense allowed to be carried forward up to five years;
- subjecting a deemed tax presence for non-residents with respect to imported technical and management services to a final withholding tax rate of 10%; and
- introducing an annual VAT registration threshold of NGN25-million.
