Entrepreneurs and owners of businesses in Nigeria are set to enjoy some tax relief after President Muhammadu Buhari assents to a new finance bill, anytime from now.
At moment, the government tax man charges 30 per cent Corporate Income Tax(CIT) flat rate on business turnover.
That will change soon. And for small businesses, it will be a new heaven.
Under the new finance bill, all companies with annual turnover less than N25 million will be exempted from paying CIT.
All companies with annual turnover between N25 – 100m will pay 20% CIT
However companies recording over N100m turnover will pay 30 per cent CIT.
Significantly, the CIT will now be charged only on profit made.
The reforms in corporate tax is part of the Buhari – Osinbajo administration’s effort to reform Nigeria’s business environment.
And the efforts are already garnering recognition from the right quarters. In the 2017 World Bank Doing Business Ranking, Nigeria moved up 24 places and was also listed among the top ten reforming economies in the world.
In 2019, the World Bank also named Nigeria one of the Top-20 improvers in doing business out of 190 countries.