For a successful implementation of the Federal Government’s economic stabilisation programme, tax experts said the proposed reforms would depend on the clarity of legislation, consistent regulatory enforcement and effective stakeholder engagement.
Ensuring these, they said, would pave the way for successful implementation as the agenda combined with existing tax structures under the Petroleum Industry Act (PIA), Petroleum Profits (PPTA) and the Deep Offshore Inland Basing (DOIBPSC) aimed to strike a balance between revenue generation for the government and investment incentives for operators.
They said this at the fourth edition of the Economic Stabilisation Bill organised by the Chartered Institute of Taxation of Nigeria (CITN).
In a paper presentation, Managing Partner, Ascension Consultancy Services, Alatoye Azeez, recommended that companies operating in the upstream sector should stay informed and compliant, and optimise deductions to minimise tax liabilities.
He urged businesses to maintain accurate records while companies should engage tax consultants on tax planning strategies.
Azeez, who is also the Dean of Extractive Industries Taxation Faculty, CITN, gave a general overview of the taxation of income from petroleum operations, stating that a key component of the bill is the adjustment of tax structures for upstream petroleum operations to align with the PIA 2021.
While he analysed the tax laws, he emphasised the imperative of tax audits in the oil and gas industry and tax administration, giving the institute’s position.
He urged the participants to broaden their horizons by gaining a clear understanding of the legislative and regulatory background governing the taxation of petroleum operations in Nigeria under the 2024 Economic Stabilisation Bill.
He urged the participants to explore the fundamental principles of hydrocarbon tax (HT) and petroleum profits tax (PPT) to appreciate how chargeable profits are determined in the oil and gas sector among others.
Assistant Director of the Oil and Gas Department, Federal Inland Revenue Service (FIRS), Emmanuel Okon, said there is a need to be mindful of aggressive tax planning and tax evasion, adding that there was a thin line between both.
Similarly, other discussants, Partner, Deloitte, Olumide Esan and Tax Manager, Shoreline Natural Limited, Oluremi Olubamowo, said operators and members needed to familiarise and reinvent themselves on the contents of the bill.
They equally called in critical stakeholders to work together to enforce compliance.
Earlier, CITN President, Samuel Agbeluyi, urged members on the need for learning and relearning to excel in the sector, adding that the institute in March would come up with tax nuggets through training that would simplify taxation and equally add value to the institute.
