July 21, 2024
FG Has Approved Withholding Tax Exemption For Businesses Earning N25m Annually
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FG Has Approved Withholding Tax Exemption For Businesses Earning N25m Annually

The Chairman of the Presidential Committee on Fiscal Policy and Tax Reforms, Taiwo Oyedele, says the Federal Government has approved the exemption of small businesses from withholding tax.

Speaking to the press at a recent consultation forum on the mandate of the tax reform committee in Lagos, he said the exemption applies to businesses earning N25 million annually and below.

Withholding Tax is an advance payment of income tax which may be used to offset or reduce tax liabilities, according to the Federal Inland Revenue Service, and is deducted at varying rates ranging from 5 percent to 10 percent depending on the transaction.

READ ALSO: ₦1bn Loan Available For Businesses At 9% Interest Rate, Says Finance Minister

Oyedele said one of the objectives of the withholding tax regulation is to simplify it, and reduce the burden on businesses, particularly SMEs.

He said the tax reform committee wants to promote competitiveness, equity, and ease of compliance.

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