Digital firms to pay tax under new Finance Act – Osinbajo

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Vice President Yemi Osinbajo has disclosed that multinational digital companies operating abroad with significant economic presence in Nigeria will be subjected to taxation under the new Finance Act.

He said only companies that have a physical presence in the country were being taxed previously, adding that the new law had changed this.

Osinbajo disclosed this on Friday in Abuja during a lecture titled, ‘Economic Dimension of National Security: The Nigerian Experience,’ organised for participants of Course 28 of the National Defence College.

He said, “So, most digital and multinational technology companies do not have a physical presence in Nigeria, yet make significant income in Nigeria from online activities.

“They pay no tax to Nigeria because they do not have a physical presence in Nigeria, now we are no longer relying on physical presence.”

“Under the new Act, once you have a significant economic presence in Nigeria, you are liable to tax whether you are resident here or not,” he noted, adding that non-residents, who previously had no fixed address would now be taxed under the new Act.

The vice president said that the Finance Act was designed to generate more revenue for the government and improve the ease of doing business in Nigeria.

He noted that adequate provisions were made under the Act to protect the Small and Medium Scale businesses in view of their roles in national development.

Osinbajo said the economic policies of the Federal Government were centred on creating a conducive environment for the private sector to thrive and support the creation of wealth, jobs and opportunities.

He stated, “Private sector is key to job creation and in doing so, the government has a responsibility to provide the needed infrastructure and enabling environment.

“Before the private sector is able to provide sufficiently for the majority of people, it is the responsibility of government to provide a safety net for the extremely vulnerable and those who cannot work”.



Source: Punch

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Author: abokimallamfx