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KPMG flags red signals in new tax laws
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
Bring Your Children Back To Nigeria To Lead Your “Operation Wetie,” South-West PDP Tells Makinde
The South West chapter of the Peoples Democratic Party has told the Governor of Oyo State, Seyi Makinde, to ensure that all his children come back to Nigeria, from where they are schooling abroad to be part of the “operation wetie” (Political Violence) that he preached in Ibadan today.
Makinde had invoked the violent political history of “Operation Wetie”, a campaign of deadly political violence that rocked the Western Region of Nigeria in the mid-1960s.
It was adapted from the Yoruba phrase meaning “wet or soak” homes and vehicles of perceived political opponents with petrol before setting them ablaze.
Makinde made this inciting comment at the National Summit of All Opposition Political Party Leaders in Ibadan, Oyo State today.
Reacting through its Publicity Secretary, Hon. Akinloye Oyeniyi, the PDP in the Southwest Zone disowned the summit saying; “the meeting was a jamboree staged to revive Governor Seyi Makinde’s dwindling political fortune and hand him the vice presidential candidate’s ticket of the David Mark-led ADC.”
The party, which also described Makinde’s comment as reckless, and unbecoming of a sitting governor, added that the Southwest will not be available to be used as a political war-zone by any disgruntled and selfish politician.
Clarifying the status of the meeting, Oyeniyi said; “The event was a meeting of a coalition masquerading as an all-opposition-parties summit. It did not represent the PDP or the broader opposition in Nigeria. Rather, it’s to serve the interest of the person whose scheming is to get the vice presidential ticket of the coalition through the back door.”
The party commended former President Olusegun Obasanjo for staying away from the meeting, saying his absence made it clear to the world that he is not part of that group.
Oyeniyi further alleged that the summit was convened by Governor Makinde as a face-saving move.
“The governor has swallowed embers that are now burning his chest, reason he assembled those whose records do not reflect seriousness, in Ibadan, to chart a fresh course into further chaos in their coalition,” he said.
The statement addressed former Vice President Atiku Abubakar and few others, reported to have attended the summit, urging them to emulate the statesmanship displayed by former President Obasanjo and ensure their names are not associated with endless controversy.
“The chairman of that already failed and defeatist occasion did not show up. It is not an event to be graced by any reasonable and reputable person,” the statement added.
Addressing the Oyo State governor directly, the party said: “There is a difference between influence and illusion. This latest political fakery has again confirmed your self-inflicted free fall from grace; and the people of Oyo State shall speak clearly against all these relentless chaoses in 2027.”
The party thanked its members in the zone and maintained that it remains committed to providing credible opposition and a viable alternative for Nigerians, but would not be part of gatherings designed to deceive the public.
News
14 opposition bloc in Ibadan unite to adopt single presidential candidate against Tinubu in 2027
The decision, dubbed the ‘Ibadan Declaration’, was the central focus of a high-stakes national summit of opposition political parties held on Saturday, 25 April 2026, in the Oyo State capital.
Fourteen opposition parties have collectively agreed to field one presidential candidate against President Bola Tinubu in 2027.
The opposition political parties which participated in the summit included the PDP, ADC, PRP, NNPP, NDC, LP, APP, Accord, APM, AA, DLA, YP, ADP, and ZLP.
Reading the communiqué on behalf of the participating chairmen, the National Chairman of the People’s Democratic Party (PDP), Taminu Turaki (SAN), declared that the move was an existential necessity to rescue Nigeria from the stranglehold of the APC.
The opposition bloc made it clear that its primary objective is to prevent the emergence of a one-party state. Despite what they described as the APC’s manoeuvres to position President Bola Tinubu as a sole presidential candidate for 2027, the coalition vowed to fight back through a unified ticket.
“We shall work towards fielding one presidential candidate for the 2027 elections, which shall be agreed and supported by all participating opposition parties to rescue our nation and her long-suffering masses,” the communiqué stated.
The summit also launched a scathing attack on the leadership of the Independent National Electoral Commission (INEC). It passed a vote of no confidence in the INEC chairman, Prof. Joash Amupitan, accusing him of blatant partisanship toward the ruling party.
The declaration warned that Amupitan’s continued stay in office is vexatious and could trigger a national crisis. The summit demanded that Amupitan be replaced by a neutral figure to guarantee a credible process.
The Ibadan Declaration outlined several critical demands aimed at levelling the playing field. The National Assembly was urged to immediately strip the Electoral Act 2026 of clauses that allegedly threatened the sanctity of elections.
The parties slammed recent INEC guidelines as engineered obstacles and demanded that the deadline for party primaries be extended to the end of July 2026.
The communiqué called for the immediate release of leading politicians currently being allegedly harassed or detained on bailable offences, framing their detention as a violation of fundamental rights.
The opposition leaders commended the resilience of Nigerians in the face of what they termed state capture. They expressed a renewed commitment to multiparty democracy and swore to resist any machinations intended to stifle political competition.
The summit also appreciated the host, Governor Seyi Makinde of Oyo State, whose state served as the backdrop for what many delegates described as an epochal event in the journey toward the 2027 polls.
Fire has razed a police station and three residential buildings in Ibadan, the Oyo State capital.
The police station, according to sources, is located at Kara in Akinyele local government area of the state.
An eye-witness account says that a patrol van, motorcycles and other items were affected.
Meanwhile, three residential buildings located in three different areas within Ibadan were also razed, on Friday.
The ground floor of one of the buildings located at No.19, Omigade street, Robert junction, Ososami in Ibadan.
A residential building in the Moniya area and another at the Alakia area were also affected by the fire.
Chairman of the Oyo State Fire Service, Maroof Akinwande confirmed the incidents.
On the police station, Akinwande said, “On getting to the scene, it was a patrol van and seven motorcycles that were engulfed by fire. Our officers quickly launched a coordinated attack, restricted the fire from spreading to the police station’s building and other properties”.
Bring Your Children Back To Nigeria To Lead Your “Operation Wetie,” South-West PDP Tells Makinde
14 opposition bloc in Ibadan unite to adopt single presidential candidate against Tinubu in 2027
Sad: Fire razes Police station, three residential buildings in Ibadan
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