Present & Future

A red through and through

[Present & Future @robertobaggio28]

@CRawkeen @dondekojo That’s why you don’t understand sarcasm😂

[Present & Future @robertobaggio28]

@CRawkeen @dondekojo I agree. You aptly describe the action of Mr Commissioner. I couldn’t have put it better. Thank you

[Present & Future @robertobaggio28]

@CRawkeen @dondekojo So he was accused of being a bigot and thought only one way to address it as a public official. Embrace it! Brilliant

[Present & Future @robertobaggio28]

@FailedRift It is scary. Especially when you hear the argument of whether you want the opponent to copy their idea. Are we covering our books here too?

[Present & Future @robertobaggio28]

@DoubleEph 8a and 8b? We do number houses that way here so why can’t we number wonders of the world similarly?

[Present & Future @robertobaggio28]

@damazinganita Is it spelt Ulor or Olor?

[Present & Future @robertobaggio28]

This is the story of most Nigerian professionals. Close at 7pm and enter traffic to Ikorodu only to resume at 7am next day on the Island. Ok 8am but have to leave at 5am

[Cinderella Man @Osi_Suave]

Teacher will leave school at 3pm and touch 3 homes btwn 3 and 7pm to collect 100k per home to buff up his salary.

Before he faces traffic to Ayobo from the island to resume at 7am the next day.

Is this how a person should live ?

[Present & Future @robertobaggio28]

No school charging 6m per student has 360 students. At most you will be looking at 180 and that is even a stretch. Just look around you and count the number of people you know who can afford that amount.

[Cinderella Man @Osi_Suave]

Let me do a breakdown for you.

Number of Students: 360

Tuition per Student per Session 6m
Total Revenue: 2.1 billion.

Lead Teachers 18 @ 700k - 151m annually.

Assistant Teachers 18 @ 350k -75m annually

Specialist Teachers 6 @ 600k monthly 43m a year.

Total Academic Staff Cost 270m.

Head of School: 18m annually
Vice Principal: 12m annually
Bursar: 9m annually
HR/Admin:7m annually
Front Desk (2 staff): 9m annually

Total Admin Cost: 56m.

Cleaners: 10m annually
Security: 12m annually
Drivers: 9m annually
Maintenance: 7m annually

Total Support Staff Cost: 40m

Annual Rent Premium Location 250m.

Diesel & Power: 60m
Internet & Technology: 15m
Repairs & Maintenance: 30m
Teaching Materials: 40m
Insurance: 20m

Total Operations Cost: 165m

Digital Marketing: 20m
Events/Open Days: 15m
PR & Media: 15m
Brand Collateral: 10m
Total Marketing Cost: 60m

Financial Summary

Revenue 2.1billion.
Academic Staff 270m
Administration56m
Support Staff40m
Rent250m
Operations 165m
Marketing60m
Feeding180m

Estimated Profit1.1billion.

[Present & Future @robertobaggio28]

There are gaps, errors and inconsistencies. It’s normal with large scale reforms like this. It’s not peculiar to Nigeria. Public engagement like this should be encouraged not frowned upon.

[Taiwo Oyedele @taiwoyedele]

𝐑𝐞𝐬𝐩𝐨𝐧𝐬𝐞 𝐭𝐨 𝐊𝐏𝐌𝐆: 𝐎𝐛𝐬𝐞𝐫𝐯𝐚𝐭𝐢𝐨𝐧𝐬 𝐨𝐧 𝐍𝐢𝐠𝐞𝐫𝐢𝐚’𝐬 𝐍𝐞𝐰 𝐓𝐚𝐱 𝐋𝐚𝐰𝐬

---𝘉𝘺 𝘗𝘳𝘦𝘴𝘪𝘥𝘦𝘯𝘵𝘪𝘢𝘭 𝘍𝘪𝘴𝘤𝘢𝘭 𝘗𝘰𝘭𝘪𝘤𝘺 𝘢𝘯𝘥 𝘛𝘢𝘹 𝘙𝘦𝘧𝘰𝘳𝘮𝘴 𝘊𝘰𝘮𝘮𝘪𝘵𝘵𝘦𝘦

We welcome all perspectives that contribute to a shared understanding and successful implementation of the new tax laws. We acknowledge that a few points raised by KPMG are useful, particularly where they relate to implementation risks and clerical or cross-referencing issues. However, the majority of the publication reflected a misunderstanding of the policy intent, a mischaracterisation of deliberate policy choices, and, in several instances, repetitions and presentation of opinion and preferences as facts.

𝐆𝐞𝐧𝐞𝐫𝐚𝐥 𝐨𝐛𝐬𝐞𝐫𝐯𝐚𝐭𝐢𝐨𝐧𝐬

A significant proportion of the issues described as “errors,” “gaps,” or “omissions” by KPMG are either:

- the firm’s own errors and invalid conclusions,
- issues not properly understood by the firm,
- missed context on broader reforms objectives,
- areas where KPMG prefer different outcomes than the choices deliberately made in the new tax laws, and
- obvious clerical and editorial matters already identified internally.

While it is legitimate to disagree with policy direction, disagreements should not be framed as errors or gaps. KPMG would have been more effective if the firm adopted a similar approach like other professional firms who engaged directly providing the opportunity for clarifications and mutual-learning.

It is equally important to distinguish between policy choices designed to achieve the reform objectives and proposals that merely represent a firm's preference.

𝐏𝐨𝐥𝐢𝐜𝐲 𝐂𝐡𝐨𝐢𝐜𝐞𝐬 𝐚𝐧𝐝 𝐂𝐥𝐚𝐫𝐢𝐭𝐲 𝐨𝐧 𝐑𝐞𝐟𝐨𝐫𝐦𝐬

1. Taxation of Shares and the Stock Market

Contrary to the presumption that the new tax provisions on chargeable gains would trigger a sell-off on the stock market, the fact is that the applicable tax rate on share gains is not a flat 30%. The tax framework is structured from 0% to a maximum of 30%, which is set to reduce to 25%. Furthermore, a significant majority of investors (99%) are entitled to unconditional exemption, with others qualifying subject to reinvestment.

The market's performance, which is at an all-time high with increased investment flow, demonstrates investors understanding that the tax changes will enhance the fundamentals of firms both in terms of profitability and cash flows. The sell-off narrative is unsubstantiated as any disposals in December 2025 would have benefited from the re-investment exemption or enhanced deductions under the new law.

2. Commencement Date and Transition

The suggestion to set the commencement date as the start of an accounting period (e.g., 1 January 2026) takes a narrow view of the complex transition issues. A wholesale reform affects myriad issues beyond the accounting period, spanning multiple periods, different bases of assessment (preceding year, actual year), as well as issues related to audit, deductions, credits, and penalties. Limiting the commencement to a single date for accounting periods would fail to address the intricacies of continuous transactions and other transition matters. KPMG’s proposal is therefore not a “gold standard” to be applied to all new laws as suggested.

3. Indirect Transfer of Shares

The new provision to tax indirect transfer of shares is a policy choice aligned with global best practices and BEPS initiatives. Its objective is to block a long-exploited tax loophole by multinationals and other investors, not to affect competitiveness. This is a common provision in international tax, and the assertion that it may affect the country's economic stability is disingenuous.

4. VAT Exemption on Insurance Premium

KPMG's point regarding a specific VAT exemption on insurance premium is technically unnecessary, as an insurance premium is not a "taxable supply" defined under the Nigeria Tax Act. Insurance relates to risk transfer, not the supply of goods or services subject to VAT. As this has always been the administrative and legal position, a specific amendment for exemption is academic. If it is not broken, don’t fix it.

𝐈𝐬𝐬𝐮𝐞𝐬 𝐑𝐞𝐟𝐥𝐞𝐜𝐭𝐢𝐧𝐠 𝐌𝐢𝐬𝐮𝐧𝐝𝐞𝐫𝐬𝐭𝐚𝐧𝐝𝐢𝐧𝐠 𝐁𝐲 𝐊𝐏𝐌𝐆

5. Inclusion of 'Community' in Definition

The concern about the inclusion of “community” in the definition of a ‘person’ but its omission from the charging section does not constitute a gap or ambiguity. In statutory interpretation, definitions provided in the law apply wherever the defined term appears, unless the context requires otherwise. Hence, ‘person’ and ‘taxable person’ are used in the charging section, and both definitions include ‘community.’ This approach is consistent with modern legislative drafting principles, which use comprehensive definitions to streamline operative provisions and avoid redundancy. This is similar to the inclusion of partnerships and executors in the definition but not under the charging section. The use of the word “includes” further signifies that the list of taxable persons is not exhaustive.

6. Joint Revenue Board (JRB) Composition

The composition and mandate of the Joint Revenue Board (JRB) are intentional. Its policy advisory role is specifically to provide a subnational tax and revenue perspective that complements the fiscal policy mandate of the Ministry of Finance. Its membership is appropriately limited to revenue-focused agencies, which is why it is called the Joint Revenue Board. This is a similar composition under which the former JTB operated effectively, and its functions remain consistent with the need for inter-agency coordination.

7. Distinction in Dividend Treatment

KPMG's analysis appears to mix the distinction between a foreign-controlled company and a foreign operation of a Nigerian company. Dividends distributed by a foreign company cannot be "franked" since no Nigerian Withholding Tax (WHT) would have been deducted. Section 162(1)(s) confers exemption on dividend, interest, rent, or royalty derived from outside Nigeria and brought into Nigeria through approved channels. The choice to treat dividends distributed by Nigerian companies differently from foreign companies is a deliberate policy choice, as they are fundamentally different for tax purposes.

8. Non-Resident Registration and Final Tax

The view that a payment subject to deduction as final tax should automatically exempt the non-resident recipient from tax registration misses a critical distinction. While the law conditionally exempts passive income from registration, the deduction of tax on non-passive income is not synonymous with an exemption from registration or filing of returns. The same way that residents are required to file returns on income such as interest (in the case of individuals) and dividend where WHT is final. Returns serve a broader purpose beyond solely generating tax revenue.

𝐊𝐏𝐌𝐆’𝐬 𝐏𝐫𝐨𝐩𝐨𝐬𝐚𝐥𝐬 𝐓𝐡𝐚𝐭 𝐖𝐨𝐮𝐥𝐝 𝐔𝐧𝐝𝐞𝐫𝐦𝐢𝐧𝐞 𝐊𝐞𝐲 𝐑𝐞𝐟𝐨𝐫𝐦 𝐎𝐛𝐣𝐞𝐜𝐭𝐢𝐯𝐞𝐬

9. Tax on Foreign Insurance Premiums

The proposal to exempt foreign insurance companies from tax on premiums from insurance written in Nigeria to deepen penetration, while local insurance companies continue to pay tax, would be detrimental to the domestic insurance sector. This would create an unfair and harmful competitive disadvantage for local firms in their own market. The current policy is designed to protect and promote local industry and ensure a level playing field.

10. Parallel Market Forex Deduction

The new law disallows tax deduction for the difference where a business buys foreign exchange in the parallel market at a premium over the official rate. This is a critical fiscal policy choice designed to complement monetary policy, strengthen, and stabilise the Naira. By removing the tax subsidy for patronage of the parallel market, the policy aims to reduce incentives for round-tripping and redirect legitimate FX demands to the official market. This is policy congruence, not an error.

11. VAT Compliance-Linked Deductibility

The non-tax deduction for taxable transactions on which VAT has not been charged is a necessary anti-avoidance measure. It removes the advantage that some taxpayers previously enjoyed by patronising suppliers who evade VAT. This is a matter of fairness and is squarely within the control of a business to manage, especially given the provision for the self-charge of VAT. It also ensures that responsible businesses play their part in promoting voluntary tax compliance across the ecosystem.

12. Progressive Personal Income Tax

While KPMG acknowledges the reform objective of fairness and progressivity, the firm disagrees with a top marginal tax rate of 25% for the highest earners. In reality, the effective tax rate can be as low as 22% for an individual earning billions a year simply by contributing 10% to pension. This rate is competitive when compared to many other countries, including Angola 25%, Egypt 27.5%, Ghana 35%, Kenya 35%, the U.S. (Federal) 37%, South Africa 45%, and the U.K. 45%. So, the rate is not “oppressive” or one that will negatively affect economic growth as claimed, rather it ensures progressivity without compromising competitiveness. From a broader policy objective perspective, the increase in top marginal rate for high income earners and the reduction in corporate tax rate is designed to address the existing higher tax burden associated with business formalisation.

𝐅𝐚𝐥𝐬𝐞 𝐈𝐧𝐜𝐥𝐮𝐬𝐢𝐨𝐧 𝐚𝐧𝐝 𝐅𝐚𝐜𝐭𝐮𝐚𝐥 𝐄𝐫𝐫𝐨𝐫 𝐛𝐲 𝐊𝐏𝐌𝐆

13. Police Trust Fund

The Police Trust Fund was signed into law on May 24, 2019, with a six-year lifespan under section 2(2) of the Act, which ended in June 2025. Therefore, KPMG's point that the new tax law should be amended to repeal the taxing section of the Police Trust Fund Act is needless, as the provision no longer exists.

14. Small Company Verification

The analysis concerning the tax exemptions for small companies affecting large companies' obligations is not a new issue or an inconsistency in the new law. The small business threshold was introduced via the Finance Act 2021. This issue pre-dates the current tax laws and should not be presented as an error or omission simply by virtue of a higher tax exemption threshold under the new law.

𝐖𝐡𝐚𝐭 𝐊𝐏𝐌𝐆 𝐋𝐞𝐟𝐭 𝐎𝐮𝐭

While acknowledging the objectives of the reform, KPMG could have highlighted the major structural improvements under the new laws, including:
- simplification and tax harmonisation,
- the scope for reduction in corporate tax rate from 30% to 25%,
- expanded input VAT credits for businesses,
- tax exemption for low-income earners and small businesses,
- elimination of minimum tax on turnover and capital, and
- improved investment incentives for priority sectors.

A balanced assessment would have recognised these transformative elements, among others.

𝐂𝐨𝐧𝐜𝐥𝐮𝐬𝐢𝐨𝐧 𝐚𝐧𝐝 𝐖𝐚𝐲 𝐅𝐨𝐫𝐰𝐚𝐫𝐝

The tax reform is the result of an extensive consultation with various stakeholder groups in addition to the legislative process that included widely publicised public hearings, avenues intended for all stakeholders including international firms to provide technical expertise at the formative stage.

In any comprehensive overhaul of a nation’s tax framework, clerical inconsistencies or cross-referencing gaps may occur, and these are already being identified within the government. The tax reform represents a bold step toward a self-sustaining and competitive Nigeria.

An effective review needs to connect identified gaps to clear policy intents and the reality of modern-day tax systems within the context of economic development and global competitiveness.

At this stage, the effectiveness of the tax law depends on administrative guidance, clarifications from the tax authority, and regulations to complement precise statutory provisions where necessary pending future amendments.

We urge all stakeholders to pivot from a static critique to a dynamic engagement model, which allows for clarifications and a productive partnership in the implementation of the new tax laws.

[Present & Future @robertobaggio28]

I think this is the most annoying thing from yesterday. He went back and stuck with it just to earn a pointless point.

[Dylan @Dylyano]

Amorim went back to his base principles to prove a point and ended up showing everyone else they were right the entire time

[Present & Future @robertobaggio28]

I’m now fully Amorim out!!! Has no idea what he is doing. More interested in how he looks than winning football games otherwise why change what worked a few days ago?

[Scott Patterson @R_o_M]

At least he took Heaven off for Yoro though 👍🏼

[Present & Future @robertobaggio28]

The man is a legend. Just enough to keep hope alive.

[Present & Future @robertobaggio28]

@TheYomiKazeem Might? What do you mean might? He would have been sent to the guillotine, no doubt

[Present & Future @robertobaggio28]

Took a 60% pay cut years ago to move from bank to big 4. Best decision of my life. 6 years later while bank mates were still ABOs turned down offer for AGM at a Tier one Bank. Don’t move to tax though. Go to Audit.

[MS Ingawa @MSIngawa]

Deloitte comes with global prestige and career reputation and even money in long term due to network and credibility while life comes bills and demands.

But personally, I will take a pay cut for Big 4 especially at young age.

TL, what do you advise?

[Present & Future @robertobaggio28]

Had a similar experience in Paris. Attendant looks at me and says, economy is that other way and I look at it him and say I know and walk past to the check in counter. Two white couples were in front of me and all he said to them as they passed was Bonjour!!

[David Oliver @mancunianmedic]

black guy gets on my train at Wolverhampton just now

the guard says "It's first class in that carriage. There's loads of seats at the other end"

"I do use first class as well you know, mate"

guard just assumed.......

[Present & Future @robertobaggio28]

@VeldaPaul This is the hard part but I guess I need to get it done. Still have plenty of life and work for the knee so it has to hold. Thank you so much

[Present & Future @robertobaggio28]

@VeldaPaul I just did an MRI on my knee which showed osteoarthritis too. I am curious as to what sort of exercises you have been doing that has helped.

[Present & Future @robertobaggio28]

@DoubleEph @Teeniiola Maybe BA is euphemism for any flight from London to Lagos? lol

[Present & Future @robertobaggio28]

@uzoart Are you comparing average salary for Nigeria or that of the average resident in VI? Maybe miles apart though