A proposed amendment to the Companies Income Tax Act, aimed at providing relief to businesses reporting losses, has cleared its second reading in Nigeria’s House of Representatives.
The bill seeks to exempt companies that record losses during a financial year from paying the minimum income tax, currently set at 0.5% of gross turnover, as stipulated under Section 33 of the existing Act.
Proponents of the amendment argue that the measure will offer much-needed security and support to struggling businesses, helping them recover without the added burden of minimum tax payments.
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If passed, the amendment will introduce a new subsection specifically targeting firms unable to generate taxable profits, ensuring they are not penalised during challenging financial periods.
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