Thousands of Nigerian businesses may be paying less tax than necessary as a combination of new incentives, deductions, and compliance provisions opens up legal avenues to reduce tax liabilities under the country’s new tax regime.
Tax advisers say interest in tax planning has increased since the implementation of the reforms, with businesses reviewing expenses, investment decisions, compensation structures, and tax credits to ensure they are not leaving legitimate savings unclaimed.
“Companies are restructuring, merging with complementary businesses, adjusting branch operations, and reorganising record-keeping to meet tax incentives eligibility requirements,” said Marvis Oduogu, lead, taxation at Stren & Blan Partners.
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The trend comes as the government intensifies efforts to improve tax collection. Nigeria’s tax-to-GDP ratio has climbed to about 13 percent from below 10 percent in previous years, though it remains below the African average of around 16 percent, underscoring the gap policymakers are trying to close.
