Tax & Business Matters - Nigeria

OECD publishes full version of its latest Model Tax Convention

The Organisation for Economic Cooperation and Development (OECD) on Thursday 25 April 2019, published the full version of its 2017 Model Tax Convention on Income and Capital, the tenth edition.

This full version contains Articles, Commentaries, non-member economies’ positions, the Recommendation of the OECD Council, the historical notes and the background reports. It incorporates some of the measures from the OECD BEPS Project including hybrid mismatch, treaty shopping, artificial avoidance of permanent establishment and dispute resolution.

The model convention is designed to provide a standard template for concluding avoidance of double taxation treaties between countries to facilitate economic development, limit double taxation, prevent double non-taxation, and enhance mutual agreements and assistance on tax matters.

See link for a copy of the 2017 Model Tax Convention (full version).

NIPC has published reports of Pioneer Status Incentives, Application Guidelines and Delegation Order

In furtherance of its ongoing reforms, the Nigerian Investment Promotion Commission (NIPC) has published reports of various pioneer status incentives (PSI) granted, declined or cancelled from 2017 to first quarter of 2019.

The reports contain disclosures about companies that benefited from the incentive and other details.

PSI	2017	2018	2019 (Q1)
Granted	13	36	7
Cancelled	0	1	0
Declined	14	3	7

The 2019 report shows that there are 219 pending applications while 54 applications have been abandoned. In total, there are currently 28 companies benefiting from the pioneer status incentive across different industries.

The NIPC has also gazetted the new Application Guidelines for pioneer status incentives and the Ministerial Order which delegates some of the powers of the Minister for Industry, Trade and Investment under the Industrial Development (Income Tax Relief) Act to the Executive Secretary of NIPC.

We commend the efforts by the NIPC to reform the pioneer status incentive regime and its commitment to transparency and accountability which will go a long way in building investors’ confidence. Going forward we hope to see quantifiable opportunity cost of the incentives and associated benefits to the economy.

See link for copy of reports and gazettes.