Tuesday, April 10, 2012

Nigeria has one of the highest corporate tax rates in the world

The global average corporate tax shows that Nigeria still has one of the highest corporate tax rates in the world, the Executive Secretary of Nigeria Investment Promotion Commission (NIPC) Engineer Mustafa Bello has said.

The Executive Secretary made the remarks in Abuja while presenting a paper on "Sector-specific incentives policy for Nigeria: Manufacturing investments incentives," at the launching of investments profiles on automotive components by the National Automotive Council (NAC).

He said that the global average corporate tax rate is about 25.51 per cent while Nigeria's average rate is about 30 per cent.

He explained that global average indirect tax rate has moved very little in the past six years, remaining within 15.2 per cent to 15.85 per cent range, adding that the Asia Pacific operates the lowest Value Added Tax system of between 3 to 5 per cent.

The former Chief Executive Officer of the Federal Inland Revenue Service Ifueko Omoigui Okauru has said that despite the reforms in the country's tax system, it's not yet "uhuru" as there is still much to be done.

"It takes time to achieve success. It is like building a foundation, we are still very far," she said.

The NIPC Executive Secretary said that the investment policy environment in Nigeria is characterized by multiplicity of taxes by different ties of government, unpredictability, high operational and entry cost, bureaucratic bottleneck among others.

He said that in ease of doing business, Nigeria was ranked 16 out of 183 countries in Africa in 2010, 15 in 2011 and also 15 in 2012. In the world, Nigeria was ranked 134 in 2010,133 in 2011 and 133 in 2012.

In global competitiveness index, Nigeria was ranked 127 out of 142 countries in 2011/2012, 127 out of 139 in 2010/2011, 99 out of 133 in 2009/2010 and 94 out of 134 in 2008/2009.

Engineer Bello said the objectives of the sector-specific incentives policy is to among other things institute a stable and conducive investment climate, simplify procedures and bring down transaction cost while instituting predictable policy environment by eliminating distortions.

Daily Trust

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