News
KPMG flags red signals in new tax laws
- Share
- Tweet /home/naijuinz/public_html/wp-content/plugins/mvp-social-buttons/mvp-social-buttons.php on line 72
https://naijablitznews.com/wp-content/uploads/2026/01/jghyj.jpg&description=KPMG flags red signals in new tax laws', 'pinterestShare', 'width=750,height=350'); return false;" title="Pin This Post">
KPMG, globally renowned auditing firm with expertise on tax services, says it has identified loopholes in the new tax laws.
The Presidential Fiscal Policy and Tax Reforms Committee had said it proposed the laws to provide better oversight on government revenues, and streamline tax administration in Nigeria to bring it closer to best practices globally and improve efficiencies in tax administration.
However, since President Bola Tinubu assented to the laws on June 26, 2025, there have been different forms of controversies surrounding them.
The laws – the Nigeria Tax Act (NTA) and the Nigeria Tax Administration Act (NTAA) – became effective on January 1, 2026.
Other are – the Nigeria Revenue Service Establishment Act (NRSEA) and the Joint Revenue Board Establishment Act (JRBEA) – which had become effective since June 26, 2025, were activated on January 1, 2026.
In a newsletter titled, “Nigeria’s New Tax Laws: Inherent Errors, Inconsistencies, Gaps and Omissions”, KPMG called for urgent reviews to ensure the attainment of the tax reform objectives.
The piece said that if well implemented, there are many provisions in the laws that would result in increased revenue for the government.
But it laid emphasis on the need to strike a balance between revenue generation and sustainable growth.
“Section 3(b)&(c) of the NTA – Imposition of tax – Error/Gap – The section specifies persons on
whom taxes should be levied, including individuals, families, companies or enterprises, trustees, and an estate, but omits ‘community.’ However, community’ is included in the definition of ‘person’.”
Under Section 201.
“Recommendation – If the intention is to impose tax on communities, this should be explicitly
introduced in Section 3. Otherwise, the law should clearly state that communities are now exempt from tax.
“Section 6(2) of the NTA – Controlled foreign companies (CFC) Error/Gap – The Act states that undistributed foreign profits are to be “construed as distributed” but also mandates that they be “included in the profits of the Nigerian company” (implying income tax at 30%). Though dividend distributed by a Nigerian company is deemed to be franked investment income, this does not appear to be the case with dividends distributed by foreign companies. It thus appears that such dividends will be taxed at the income tax rate. Consequently, there will be differences in the treatment of dividends distributed by Nigerian companies and those distributed by foreign companies.
KPMG in its latest newsletter titled, “Nigeria’s New Tax Laws: Inherent Errors, Inconsistencies, Gaps and Omissions”, reaffirmed the potential of the laws to transform tax administration in the country.
“Recommendation – Modify the section by providing clarity on the treatment of foreign and local dividends.”
Citing an error/gap in Section 17(3) (b) of the NTA which bothered on taxation of non-resident persons, KPMG recommended that Section 6(1) of the NTAA should be updated to include not only non-residents that derive passive income from investments in Nigeria but also income in which the deduction at source is the final tax.
This, it stated, would clearly absolve non-residents from the tax registration requirement where they have no Permanent Establishment (PE) or Significant Economic Presence (SEP) in the country.
The report stated, “This section specifies the conditions under which profits derived by a non-resident are taxable in Nigeria. Although Section 17(4) of the NTA states that payment deducted at source in respect of payments by Nigerian residents to non-residents, irrespective of where the service is rendered, shall be final tax where the non-resident has no permanent establishment (PE) or Significant Economic Presence (SEP) in Nigeria to which the payment is attributable, it does not clearly absolve the non-resident from tax registration requirements under Section 6(1) of the NTAA.
“This in, our view, cannot be the intention of the law. The intention should be that non-residents that do not have PE or SEP in the country should not be required to file tax returns as provided for in Section 11(3) of the NTAA.”
The section states that expenses incurred in a currency other than the naira may only be deducted to the extent of its naira equivalent at the official exchange rate published by the Central Bank of Nigeria (CBN).
According to KPMG, this implied that where a business buys forex at a rate that is higher than the official rate, such a company cannot claim tax deduction for the difference in value between the official and the other rates.
The intention, it noted, is to discourage speculative foreign exchange transactions and encourage the appreciation of the naira, adding however, that issues surrounding the accessibility of all forex needs due to supply problems have not been fully considered.
“We do not think that this condition is necessary at this time. With the current state of the economy, focus should be on improving liquidity and introducing stricter reporting requirements to track and monitor foreign exchange transactions.”
KPMG also picked holes in Section 21 of the NTA which includes expenses on which VAT had not been charged.
“This means that such expenses will not be considered allowable tax deductions even when those expenses have been validly incurred for business purposes. This implies that a company could be held accountable for any inaction or non-performance by its suppliers or service providers.”
“While the defaulting service providers may eventually be required to pay the VAT during an audit or investigation, the company will have already been denied the ability to claim a deduction for the related expense,” it said.
(Daily Trust)
News
Reps Move to Modernise Price Control Law, as Bill Pass Second Reading
By Gloria Ikibah
The House of Representatives on Wednesday pushed forward sweeping reforms to Nigeria’s price control regime, as lawmakers approved key bills for second reading amid spirited debate on parliamentary procedure.
Leading debate on the Bill to amend the Price Control Act, Ahmed Munir, declared that the 1977 legislation had become obsolete and ineffective in the face of present-day economic realities.
“The original intent of the 1977 Act was global, to protect ordinary Nigerians from hoarding, price gouging and artificial scarcity. However, the mechanisms it put in place and the list of commodities it covered are completely out of sync with the economic realities of 2026.
“As it stands today, the Price Control Act is blindly a dead letter law,” he said.
He criticised the existing penalties as “laughably low” and faulted the Act for failing to define essential goods in line with the needs of modern households.
He stressed that the amendment would not amount to a return to rigid price-fixing.
“While inflation has external and structural drivers, we cannot ignore the local menace of unscrupulous middlemen, artificial hoarding and predatory price-fixing by cartels, taking advantage of the vulnerability of our people. The current 1977 Act fails us in two major ways — obsolete penalties and vague and outdated definitions.
“This amendment does not seek a return to archaic, heavy-handed price-fixing, which we know destroys businesses. Rather, it introduces a smart, balanced and realistic regulatory framework.
“This bill is not about suffocating the free market. It is about putting a civilised guardrail on it. It ensures that while businesses make legitimate profits, the desperate situation of our citizens is not weaponised against them by cartels,” Munir argued.
According to him, the proposal will “bring transparency to supply chains and give teeth to the regulatory bodies like the Federal Competition and Consumer Protection Commission”.
He urged colleagues to back what he described as “this vital, people-centred bill.”
When put to a voice vote by the presiding officer, Speaker Tajudeen Abbas, the House unanimously adopted the motion and referred it to the Committee on Commerce for further legislative action.
News
BREAKING: ‘Hope Is Here’: Reps Rally Support for State Police Ahead of Crucial Constitutional Vote On Thursday
…as Deputy Speaker, Regional leaders declare House united on security reform
By Gloria Ikibah
The House of Representatives has intensified its push for the establishment of state police, declaring that lawmakers are prepared to take decisive legislative action to address Nigeria’s worsening security challenges.
Addressing journalists alongside zonal and caucus leaders of the House, Deputy Speaker Benjamin Kalu said the National Assembly was determined to complement the efforts of the Executive through constitutional reforms that will strengthen policing and improve response to insecurity across the country.
The bill sponsored by Deputy Speaker Kalu and 14 other lawmakers, was passed on February 20, 2024, it seeks to transfer “Police” from the “Exclusive Legislative List ” to the “Concurrent Legislative List”, effectively empowering states to have state to have state-controlled policing.
It proposes 16 alterations to the constitution and introduces a comprehensive framework to ensure cohesion accountability, and uniform standards between the federal police and state police.
The bill also seeks to establish State Police Service Commission as distinct from the Federal Police Service Commission with clearly defined roles and jurisdictions.
Kalu argued that while Parliament had continued to exercise its oversight powers by summoning security chiefs and government officials, lawmakers must also deploy legislative solutions to tackle the root causes of the nation’s security crisis.
The Deputy Speaker noted that the House had always positioned itself as a platform where national challenges are debated and practical solutions developed through legislation.
He said: “When we say that security of lives and property is a primary purpose of government, what do the executive think that that particular section refers to? Does it consign the three arms of government? And if yes, what is the executive doing? While we call them to order as Parliament and as allowed by Sections 88 and 89 of the Constitution of the Federal Republic of Nigeria 1999 as amended, the question becomes, have we done our part in regards to the expectation of 88 and 89 as it consigns legislative functions?
“We have always referred to the Parliament, the House of Representatives, as the solution hub where hydra-headed problems of the country are presented and solutions given to them in security and legislative tool to cure it.
“Whilst we call the chief service chiefs to come and meet with us to dialogue, while we call ministries of finance, budget office and all the others, there is the need for us to use legislative tool to block the car.”
Kalu praised members of the constitutional amendment committees and regional leaders of the House, describing them as the driving force behind the ongoing efforts to reform the nation’s security architecture.
“These men here are the real leaders of the House of Representatives who have been working night and day.
“When I mean night and day, I mean literally night and day.”
According to him, lawmakers have concluded that the current constitutional framework governing policing is inadequate to meet the security expectations of Nigerians.
“We have discovered that leaving the law as it is will not give us that expectation that all Nigerians have placed in the expectation basket with regards to curing the issue of insecurity.
“Therefore, we decided to prioritise the issue of unbundling security-related problems, response time through the legislative tool of legislation, targeting policing”, he said.
He disclosed that consultations on state policing had attracted broad support from critical stakeholders, including the Inspector-General of Police, governors and the Executive arm of government.
The Deputy Speaker argued that constitutional provisions, particularly Section 214 and related clauses, would need to be amended to pave the way for state police.
“And we said as it is today, the structure which has been agreed to by the IGP and his team, national consensus has also arisen on it, the executive have bought into it, the governors have bought into it, that there is the need for state police.
“The Constitution as it is, especially Section 214 and other consequential amendments in that particular Constitution, would not birth the state police that will guarantee what we’ll be looking for in the space of security.”
Kalu revealed that the House will move to vote on the constitutional amendment proposals, with state police placed high on the agenda.
He added that the announcement was intended to reassure Nigerians that lawmakers across the six geopolitical zones and the Federal Capital Territory were united in support of the proposal.
“So we are here to announce to Nigerians that hope is coming, that hope to have a better response time to incidents of crime is here, that we have decided, do talk, that by tomorrow we’ll be voting on the Constitution and in that we’ll be prioritising state police.
“This is us telling our supporters, our constituents across the nation, that your leaders are represented here, that the six caucus leaders, including the FCT 37, they are here, regional leaders and zonal leaders are here and all of us are together on this mission.
Dismissing reports suggesting that efforts were underway to frustrate the proposal, the Deputy Speaker insisted that the House remained firmly committed to the reform.
“The Speaker has asked us to come and address Nigerians to assure them that hope is coming and there is nobody stopping us from going ahead with state police.
“We’ve read a lot of things on the news that people are trying to stop it. No, the Parliament is marching forward and by tomorrow we’ll be concluding on this”, he noted.
Expressing confidence in the next phase of the constitutional amendment process, Kalu said lawmakers expected strong support from state governors and Houses of Assembly once the proposal leaves the National Assembly.
“This is what we have come to inform you that hope is here and by tomorrow state police will make it in our constitutional amendment.
“We are hoping that by the time we finish tomorrow it will be going to the states and because we have seen the body language of the governors of these 36 states, which is in support of state police, they will work hand in hand with their Houses of Assembly to ensure that it is returned back to Mr President for his assent as quickly as possible”, he added.
The Deputy Speaker also issued an urgent appeal to lawmakers currently carrying out oversight assignments across the country to return to Abuja for the vote.
“We’re also using this opportunity to invite our members who are currently handling oversight function across Nigeria. Let them cut it short and fly in. It’s an emergency situation.
“They should cut it short and fly in tomorrow. We want all our members to be in the House so that will show our constituents that we are in support of state police and that security is priority on our list”, he said.
The proposed state police framework remains one of the most closely watched constitutional amendment initiatives before the National Assembly, with supporters arguing that decentralised policing will improve intelligence gathering, strengthen local security responses and help address the country’s persistent insecurity challenges.
News
Blackout hits Abuja, Nasarawa, AEDC explains
Abuja Electricity Distribution Company has announced an electricity outage in parts of the Federal Capital Territory and Nasarawa State.
AEDC disclosed this in a notice on Wednesday.
The disco said the outage is due to a technical fault on the transmission company of Nigeria (TCN) 132kV Apo – Karu – line 1.
Consequently, bulk electricity supply has been disrupted in areas in Abuja and Nasarawa, including in Karu, Nyanya, Jikwoyi, Kurudu, Orozo, Karshi, Mararaba, Ado, New Nyanya, New Karu Uke, Masaka, Auta Balaifi, Keffi, Nasarawa Toto, Akwanga, Nasarawa Eggon, and environs.
The disco, however, assured electricity restoration.
“The technical team of the Transmission Company of Nigeria (TCN) is currently working to restore power supply around 3:00 pm today, 10th June 2026.
“We regret the inconvenience this may cause and appreciate your patience and understanding,” AEDC stated.
Daily Post
-
News12 hours agoNECO to recruit 22,000 supervisors, cautions applicants against fake recruitment portals
-
News12 hours agoOtti woos investors to Abia medical city, industrial park, others
-
News24 hours agoTinubu Commissions OSEX Main Carriageway, Vows End To Era Of Abandoned Projects(Photos)
-
News12 hours agoUmahi gives Abuja-Lokoja highway contractors 72 hours to mobilise
-
News23 hours agoINEC Parleys With Parties, Defends Decision To Appeal Court Ruling On Primary Deadlines
-
News21 hours agoSEDC Defends Record Before Senate, Says Less Than 10% of N140bn Budget Released
-
News12 hours agoSenate Calls For Total Ban On Importation Of Textile Materials
-
News12 hours agoTinubu launches Ebola response task force, approves N10bn emergency fund
