Updated: Firms With Less Than N25m Turnover Will No Longer Pay Company Tax – Federal Government | Nigeria Updates- Breaking News, Nigerian News, Politics, Sports, Entertainment and Business - Nigeriaupdates.com Nigeria Updates
Connect with us

Business

Updated: Firms With Less Than N25m Turnover Will No Longer Pay Company Tax – Federal Government

Published

on

The Finance Bill 2019, when signed into law, will ensure that small businesses with turnover less than N25m will be exempted from Companies Income Tax.

Currently, all companies are expected to pay the Federal Government 30 per cent of their profit as Companies Income Tax.

However, the Minister of Finance, Budget and National Planning, Zainab Ahmed, said once the bill is signed into law, companies that make a turnover of less than N25m will no longer pay this tax while those that have a turnover of between N25m and N100m yearly will now pay 20 per cent as companies income tax.

She said those earning over N100m would continue to pay the 30 per cent of their profits as CIT.

The minister said:-

“Not only will small businesses be able to do more because they are not paying taxes, we are also working together with the trade authorities to also encourage people in the informal sector to become formalise because they will see other businesses like them that are not registered doing well.

“Their productivity will increase, they will employ more Nigerians and at the end of the day, they will grow to the level of a medium size business and begin to pay taxes.

She added, “Our assessment is that any business that has a turnover of less than N25m needs that break, not being taxed so they can invest in their businesses.

“We reduced the tax for medium size businesses from 30 per cent to 20 per cent so they can have more resources that they can plough back in their business.

“These are the largest employers of labour. The federal and state governments have a total labour force of less than one per cent of the population.”

On when the bill will be signed into law, Ahmed said the National Assembly had already forwarded it to the President for assent and the President had sent a copy to the Ministries, Departments and Agencies to cross-check the provisions.

She said it was saddening that the only aspect of the bill Nigerians were focusing on was the increase in Value Added Tax from five per cent to 7.5 per cent.

Continue Reading

Business

Uganda-GTB Transition Into Tier 2 Credit Institution 

Published

on

By

 

 

 

 

 

The Guaranty Trust Bank (Uganda) Ltd has shed more light on why it transited from a Tier 1 Commercial Bank to a Tier 2 Credit Institution.

 

The Management team stated that this became necessary in view of the Bank’s current paid-up share capital position of UGX 41 billion (approx. USD 11.02 million) and the recent increase in the minimum paid-up share capital requirement for Tier 1 Commercial Banks operating in Uganda from UGX 120 billion (approx. USD 32.26 million) effective 31st December 2022, to UGX 150 Billion (approx. USD 40.32Million) by 30th June 2024.

 

 

Disclosing this in a statement made available to the media  on Thursday, GTBank Uganda revealed that continuing operations as a Tier 2 Credit Institution is within the Bank’s current capital base and will allow the bank to play to it’s core strengths in Retail and SME Banking.

 

The GTBank statement reads: “Guaranty Trust Bank (Uganda) Ltd (“GTBank Uganda”) today announced its intention to transition from a Tier 1 Commercial Bank to a Tier 2 Credit Institution. This position has become necessary in view of the Bank’s current paid-up share capital position of UGX 41 billion (approx. USD 11.02 million) and the recent increase in the minimum paid-up share capital requirement for Tier 1 Commercial Banks operating in Uganda to UGX 120 billion (approx. USD 32.26 million) effective 31st December 2022, and subsequently to UGX 150 Billion (approx. USD 40.32Million) by 30th June 2024.

 

“In November 2022, the Ministry of Finance, Planning and Economic Development in conjunction with the Central Bank of Uganda prescribed new thresholds for minimum paid-up share capital unimpaired by losses for Supervised Financial Institutions (SFIs) in Uganda.

 

“Following extensive engagements with all stakeholders including the regulator and our shareholders, we believe that this is the right decision considering global economic realities and it is fully aligned with the objectives of our Holding Company -– “to direct resources to opportunities in alignment with our current strategy of evolving the Guaranty Trust Brand to a full-fledged Financial Services Group.” Commenting on this development, Mr. Jubril Adeniji, Managing Director of Guaranty Trust Bank Kenya and Head of the East African region stated, “Continuing operations as a Tier 2 Credit Institution is within the Bank’s current capital base and will allow us play to our core strengths in Retail and SME Banking. As we make this transition, we will continue to review our positioning within the Ugandan banking sector in line with our objective of maximizing shareholder value.”

 

He further added; “As a Group, we are confident of Uganda’s trajectory as a country and remain committed to championing growth and expanding innovative financial services across Africa and will continue to explore viable opportunities in both existing and new business verticals that guarantee the best use of available capital.

 

“Given the foregoing, we have carried out a thorough review of our existing customer base and put adequate measures in place to continue to meet their banking needs pending final regulatory approvals and further directives by the relevant parties.

 

“We expect the transition to be seamless and commit to continuing compliance with all guidelines and best practice throughout the change process.”

Continue Reading

Business

Eko DisCos Reportedly Sacks CEO

Published

on

By

 

 

 

 

The board of Eko Electricity Distribution Company has reportedly relieved its Managing Director/Chief Eexcutive Officer, Dr. Tinuade Sanda, of her duties as MD/CEO of the company.

 

In a letter seen by Nairametrics and signed by the company’s Chairman, Dere Otubu, the company explained that the decision was due to a directive from the industry regulator, NERC.

 

“We have received a directive from NERC stating that all staff working for the utility must be employed directly by the utility, bound by applicable service conditions that are applicable to the employees of the utility, and paid through the utility’s payroll.

 

The Disco is obligated to comply with these directives due to the powers of NERC as stipulated in the Electricity Act 2023. In compliance with the aforementioned directive, all seconded staff from WPG Ltd are being released by Eko Electricity Distribution Plc and returned to WPG Ltd.

 

Accordingly, you are hereby relieved of your role, office, and position at Eko Electricity Distribution Plc effectively immediately, and returned to your employer, WPG Ltd.”

 

Nairametrics also obtained a copy of the letter from NERC titled ‘Alleged Ghost Workers In Eko Electricity Distribution Company – Call For Investigation,’ wherein it instructed the distribution company to “ensure all existing WPG secondees involved in the loss of revenue to EKEDC in this matter are withdrawn back to WPG,” indicating that all WPG staff seconded to Eko DisCo should be removed. WPG is the core investor in Eko DisCo.

 

According to the report other executives in the company who were seconded from WPG were also affected by the directive.

Continue Reading

Business

CBN raises interest rate to 24.75% in bid to curb inflation

Published

on

By

 

 

 

 

In a move aimed at tackling the rising inflation in Nigeria, the Central Bank of Nigeria’s (CBN) Monetary Policy Committee (MPC) has announced a significant increase in the benchmark interest rate.

 

The  Monetary Policy Rate (MPR) which was previously 22.75 now stands at 24.75%.

 

Speaking to journalists after the MPC meeting, CBN Governor Yemi Cardoso, emphasized the committee’s commitment to curbing inflation and restoring the purchasing power of Nigerians.

 

He outlined the various policy adjustments implemented:

 

The most significant change is the substantial increase in the MPR to 24.75%. This makes borrowing more expensive, aiming to reduce spending and slow economic growth, ultimately bringing down inflation.

 

The CBN has also adjusted the Cash Reserve Ratio (CRR) for commercial banks, maintaining it at 45%. However, the CRR for merchant banks has been increased from 10% to 14%.

 

Additionally, the liquidity ratio remains unchanged at 13%. These measures aim to tighten control over the money supply in circulation, further dampening inflationary pressures.

 

Cardoso highlighted the importance of food security in the fight against inflation. He urged the federal government to fully implement its agricultural programmes, aiming to increase domestic food production and reduce reliance on imported food items, which can be susceptible to price fluctuations.

 

The increased interest rate will have a ripple effect throughout the Nigerian economy. Borrowers, including businesses and individuals, can expect to pay more for loans, potentially impacting investment and consumer spending.

 

However, the CBN’s actions are intended to bring down inflation in the long run, which would ultimately benefit Nigerians by stabilizing prices and protecting their purchasing power.

 

The MPC’s decision to aggressively raise interest rates reflects the seriousness of Nigeria’s inflation challenge.

 

Whether these measures will achieve the desired outcome remains to be seen. The effectiveness will depend on various factors, including the government’s success in boosting food production and the overall response of the Nigerian economy to tighter monetary policy.

Continue Reading

Trending

Copyright © 2014 NigeriaUpdates.