July 24, 2023

Introduction: In an increasingly interconnected global economy, small and medium-scale enterprises (SMEs) in Nigeria are venturing into international markets, seeking opportunities for growth and expansion. As these businesses engage in cross-border transactions and attract foreign investments, adherence to international accounting standards becomes imperative. At our accounting firm, we recognize the significance of international accounting standards and compliance for Nigerian SMEs, and we are committed to guiding our clients through this transformative journey with confidence and competence. Conclusion: In the competitive world of global business, Nigerian small and medium-scale enterprises must embrace international accounting standards and compliance to navigate the complexities of international trade and attract foreign investments. The adoption of these standards enhances financial transparency, comparability, and credibility, fostering trust among stakeholders and investors. At our accounting firm, we are dedicated to helping Nigerian SMEs embrace international accounting standards with ease and confidence. Our expert professionals offer comprehensive guidance, ensuring seamless integration and compliance with global reporting standards. As SMEs in Nigeria embark on the path of international growth and expansion, we stand ready to be their trusted partners in achieving financial excellence and success on the global stage. For professional advice on Accountancy, Transfer Pricing, Tax, Assurance, Outsourcing, online accounting support, Company Registration, and CAC matters, please contact Sunmola David & CO (Chartered Accountants & Tax Practitioners) at Lagos, Ogun state Nigeria offices, www.sunmoladavid.com. You can also reach us via WhatsApp at +2348038460036.

Introduction: The Nigeria Finance Act of 2019 was a bold step taken by the government to strengthen the fiscal landscape, boost revenue generation, and support economic growth. As a leading accounting firm in Nigeria, we embark on an evaluation of the effectiveness of the Nigeria Finance Act 2019 in achieving its objectives of revenue generation and sustainable economic development. 1. Increase in Value Added Tax (VAT) Rate: One of the major provisions of the Finance Act 2019 was the increase in the VAT rate from 5% to 7.5%. The rationale behind this change was to expand revenue collection and provide the government with additional resources to fund critical projects and public services. This increase in VAT was expected to lead to higher revenue generation for the government. 2. Expansion of VAT Coverage: The Act also expanded the scope of goods and services subject to VAT, bringing in previously exempted items such as lease rentals, aircraft maintenance, and passenger transportation services. By widening the tax base, the government aimed to capture more economic activities and increase VAT revenue. 3. Tax Incentives for Priority Industries: To stimulate investments in key sectors of the economy, the Finance Act 2019 extended the pioneer status incentive to qualifying businesses. This incentive offered a tax holiday for an initial period of three years, encouraging companies to invest in industries deemed vital for economic growth and development. 4. Digital Services Tax (DST): Recognizing the challenges of taxing the digital economy, the Act introduced the Digital Services Tax (DST) for foreign companies providing digital services to Nigerian consumers. The DST aimed to ensure that multinational digital service providers contribute their fair share to Nigeria’s tax revenue. Evaluation of Effectiveness: The Finance Act 2019 represented a significant effort by the government to enhance revenue generation. Let’s evaluate its effectiveness based on the following aspects: 1. Impact on Revenue Generation: The Finance Act 2019’s key objective was to increase government revenue through measures like the VAT rate increase and the expansion of VAT coverage. While it is essential to note that the Act was introduced in January 2020, and its full impact might take time to materialize, initial data suggests that the changes have contributed to higher VAT collections. However, the overall effectiveness in significantly boosting revenue generation requires continuous monitoring and analysis. 2. Encouragement of Investments: The extension of the pioneer status incentive aimed to promote investments in priority industries. The Act sought to attract both domestic and foreign investments, spurring economic growth and job creation. Evaluating the effectiveness of this provision requires examining the inflow of investments in the qualifying sectors and their impact on economic development. 3. Addressing Digital Economy Taxation Challenges: The introduction of the DST aimed to address tax challenges in the digital economy. Evaluating its effectiveness requires monitoring tax collections from digital service providers and ensuring compliance with the new regulation. Conclusion: The Nigeria Finance Act 2019 represented a significant effort to enhance revenue generation and promote economic growth. While its provisions have the potential to generate higher tax revenues and stimulate investments, the Act’s full effectiveness requires continuous evaluation and analysis. As an accounting firm in Nigeria, we believe that the Finance Act 2019’s effectiveness can be maximized through effective implementation, regular monitoring, and timely adjustments to address emerging challenges. We recommend the government, businesses, and stakeholders to collaborate closely to ensure that the Act’s objectives of revenue generation and sustainable economic development are achieved for the overall benefit of Nigeria’s economy and its citizens. For professional advice on Accountancy, Transfer Pricing, Tax, Assurance, Outsourcing, Company Registration, and CAC matters, please contact Sunmola David & CO (Chartered Accountants & Tax Practitioners) at www.sunmoladavid.com. You can also reach us via WhatsApp at +2348038460036.

Introduction: The Nigeria Finance Act of 2020 introduced a range of tax and fiscal measures to promote economic growth and enhance revenue generation. As a leading accounting firm in Nigeria, we delve into the implications of the Act on the real estate sector, one of the key drivers of the country’s economy. This article explores the opportunities and challenges brought about by the Finance Act 2020 for the real estate industry. Opportunities in the Real Estate Sector: 1. Stamp Duty on Rental Agreements: The Finance Act 2020 expanded the scope of stamp duty to include rental agreements. This presents an opportunity for increased revenue generation for the government from the rental market. Real estate professionals can work with clients to ensure compliance with the new stamp duty requirements and facilitate a smooth transition to the updated tax regime. 2. Capital Gains Tax (CGT) Exemption for Investment in Infrastructure Companies: The Act provides a CGT exemption on the transfer of assets to a Real Estate Investment Trust (REIT) or an infrastructure company approved by the Securities and Exchange Commission (SEC) and the Federal Inland Revenue Service (FIRS). This incentivizes investment in REITs and infrastructure companies, fostering growth in the real estate and infrastructure sectors. 3. Tax Deductibility of Donations to Infrastructure Companies: Individuals and corporations can enjoy tax deductions for donations made to infrastructure companies approved by the relevant authorities. This measure encourages private sector participation in infrastructure development, boosting investment in real estate projects that contribute to Nigeria’s economic growth. 4. Extension of Exemption on Small Companies Income Tax: The Finance Act 2020 extended the exemption of small companies with an annual turnover of 25 million Naira or less from paying Companies Income Tax (CIT) to include an additional three years. This extension provides a conducive environment for small real estate businesses to grow and thrive. Challenges in the Real Estate Sector: 1. Impact of COVID-19 on Rental Income: The real estate sector, like many others, faced challenges posed by the COVID-19 pandemic. Lockdown measures and economic uncertainties affected rental income for property owners and developers. Real estate professionals must navigate these challenges and explore innovative ways to adapt to changing market dynamics. 2. Compliance with New Tax Provisions: With the expansion of stamp duty to rental agreements and other tax changes, real estate stakeholders need to ensure compliance with the updated tax provisions. This may require additional administrative efforts and expert guidance to understand and implement the new tax regulations effectively. 3. Economic and Political Stability: Economic and political stability are critical for a thriving real estate sector. The Nigerian real estate industry relies on a stable macroeconomic environment, favorable government policies, and a secure investment climate. Any disruptions to these factors could impact investment decisions and project developments. 4. Infrastructure and Regulatory Bottlenecks: Infrastructure deficiencies and regulatory bottlenecks can hinder the growth of the real estate sector. Adequate infrastructure, such as roads, power, and water supply, is essential to support real estate developments. Streamlining regulatory processes and addressing bureaucratic challenges can attract more investments to the sector. Conclusion: The Nigeria Finance Act 2020 presents both opportunities and challenges for the real estate sector. The expansion of stamp duty to rental agreements and tax incentives for infrastructure investments offer opportunities for revenue generation and growth. However, challenges, such as the impact of COVID-19 on rental income, compliance with new tax provisions, economic and political stability, and infrastructure and regulatory bottlenecks, require careful consideration and proactive strategies. As a reputable accounting firm in Nigeria, we recommend real estate professionals to stay informed about the provisions of the Finance Act 2020 and seek expert advice to navigate the opportunities and challenges effectively. By understanding the implications of the Act and adopting strategic approaches, the real estate sector can contribute significantly to Nigeria’s economic development and prosperity. For professional advice on Accountancy, Transfer Pricing, Tax, Assurance, Outsourcing, Company Registration, and CAC matters, please contact Sunmola David & CO (Chartered Accountants & Tax Practitioners) at www.sunmoladavid.com. You can also reach us via WhatsApp at +2348038460036

Introduction: In the Nigerian business landscape, disputes can arise unexpectedly, posing significant challenges to the growth and reputation of companies. When financial issues become the center of contention, forensic accounting services emerge as a powerful tool for resolving disputes and unearthing the truth. At our accounting firm, we understand the critical role of forensic accounting in dispute resolution, and we are committed to providing our clients with expert services that uncover the facts, facilitate fair resolutions, and safeguard their financial interests. Conclusion: As a leading accounting firm in Nigeria, we recognize the pivotal role of forensic accounting services in dispute resolution for Nigerian businesses. From fraud detection and prevention to expert witness testimonies and business valuations, our dedicated team of forensic accountants brings expertise, accuracy, and objectivity to every case. We are committed to unearthing the truth and providing our clients with the necessary evidence and insights to make informed decisions. Through our robust forensic accounting services, we aim to safeguard the financial interests and reputations of our clients, ensuring fair resolutions and enabling Nigerian businesses to navigate disputes with confidence and integrity. If your business is facing financial disputes or requires comprehensive forensic accounting services, we stand ready to offer our expertise and support, empowering you to face any challenges with resilience and clarity. For professional advice on Accountancy, Transfer Pricing, Tax, Assurance, Outsourcing, online accounting support, Company Registration, and CAC matters, please contact Sunmola David & CO (Chartered Accountants & Tax Practitioners) at Lagos, Ogun state Nigeria offices, www.sunmoladavid.com. You can also reach us via WhatsApp at +2348038460036.

Introduction: The Nigeria Finance Act of 2019 marked a significant step towards achieving sustainable economic growth and development in the country. Introduced to complement the provisions of the 2019 budget, the Act aimed to create a conducive business environment, promote investment, and strengthen the fiscal framework. As a leading accounting firm in Nigeria, we delve into the key aspects of the Nigeria Finance Act 2019 and analyze its potential impact on boosting economic growth. 1. Value Added Tax (VAT) Rate Increase: One of the major changes introduced by the Finance Act 2019 was the increase in the Value Added Tax (VAT) rate from 5% to 7.5%. This adjustment sought to bolster government revenue and support public service delivery. By increasing the VAT collection, the government has more resources to invest in critical infrastructure and social programs that contribute to economic growth. 2. Expansion of VAT Coverage: The Act also expanded the scope of goods and services subject to VAT. Items that were previously exempted, such as lease rentals, aircraft maintenance, and passenger transportation services, are now included in the VAT net. This expansion widened the tax base, increasing VAT revenues and providing the government with additional resources to invest in vital sectors of the economy. 3. Tax Incentives for Priority Industries: To stimulate investment and drive economic diversification, the Finance Act 2019 extended the pioneer status incentive to qualifying businesses. Companies granted pioneer status enjoy a tax holiday for an initial period of three years, exempting them from corporate income tax. This incentive encourages investments in priority industries, fostering technological advancements, job creation, and economic growth. 4. Export Expansion Grant (EEG) Scheme: The reintroduction of the Export Expansion Grant (EEG) scheme was another significant measure under the Act. This incentive provides grants to businesses engaged in non-oil exports, based on the value of their export volumes. The EEG scheme encourages companies to explore international markets, diversify revenue streams, and reduce Nigeria’s dependence on oil exports. 5. Digital Services Tax (DST): The Finance Act 2019 addressed the taxation challenges posed by the digital economy by introducing the Digital Services Tax (DST). Foreign companies providing digital services to Nigerian consumers without a physical presence in the country are subject to DST at a rate of 2% of their gross revenue. This measure ensures that multinational digital service providers contribute their fair share to Nigeria’s tax revenue. 6. Strengthened Transfer Pricing Regulations: The Act aligned Nigeria’s transfer pricing regulations with international best practices, as set by the organization for Economic Co-operation and Development (OECD). Strengthened transfer pricing regulations deter multinational companies from manipulating prices in related-party transactions, ensuring fair taxation and preventing base erosion and profit shifting (BEPS). Conclusion: The Nigeria Finance Act 2019 represents a comprehensive effort by the government to boost economic growth and development in the country. By increasing the VAT rate and expanding the VAT coverage, the Act aims to generate additional revenue to fund critical infrastructure and public services. The tax incentives for priority industries, the reintroduction of the Export Expansion Grant (EEG) scheme, and the Digital Services Tax (DST) encourage investments, stimulate exports, and promote fair taxation in the digital economy. As an accounting firm in Nigeria, we believe that the Finance Act 2019 lays a solid foundation for fostering sustainable economic growth. By attracting investments in priority industries, encouraging non-oil exports, and optimizing tax collections from the digital economy, the Act supports the government’s efforts to diversify the economy and drive inclusive growth for the benefit of all Nigerians. For professional advice on Accountancy, Transfer Pricing, Tax, Assurance, Outsourcing, Company Registration, and CAC matters, please contact Sunmola David & CO (Chartered Accountants & Tax Practitioners) at www.sunmoladavid.com. You can also reach us via WhatsApp at +2348038460036.

Introduction: As the financial landscape evolves with the Nigeria Finance Act of 2019, individuals must adapt their tax planning strategies to optimize their financial well-being and ensure compliance with the law. The Act introduced several changes that impact personal taxation, offering opportunities for individuals to minimize their tax liabilities while contributing to the country’s economic growth. As a trusted accounting firm in Nigeria, we present key tax planning strategies for individuals to consider under the Nigeria Finance Act 2019. 1. Understand the Tax Exemption Threshold: One of the crucial aspects of tax planning under the Finance Act 2019 is understanding the tax exemption threshold. Individuals with an annual income of 25 million Naira or less are exempt from paying Personal Income Tax (PIT). To benefit from this threshold, individuals can optimize their income streams to stay below the exempted bracket, reducing their overall tax liability 2. Leverage Tax-Deductible Expenses: The Act allows individuals to deduct certain expenses from their taxable income, effectively lowering their tax burden. Common tax-deductible expenses include contributions to pension schemes, National Housing Fund (NHF), and approved charitable donations. By strategically maximizing these deductions, individuals can reduce their taxable income and, in turn, decrease their tax liabilities. 3. Capitalize on Retirement Contributions: Under the Finance Act 2019, contributions to a registered pension scheme are tax-deductible up to a specified limit. Savvy individuals can take advantage of this provision by planning their retirement contributions strategically. Contributing the maximum allowable amount to a registered pension scheme not only secures a financially secure retirement but also lowers the taxable income, resulting in reduced tax obligations. 4. Explore Tax-Free Investments: To promote economic development, the Act encourages investments in government-approved tax-free instruments, such as infrastructure bonds and sukuk (Islamic) bonds. By considering tax-free investment opportunities, individuals can generate returns without being subject to taxation, thereby enhancing their overall investment yield. 5. Participate in the Voluntary Assets and Income Declaration Scheme (VAIDS): The Nigeria Finance Act 2019 extended the Voluntary Assets and Income Declaration Scheme (VAIDS) to provide individuals with an opportunity to regularize their tax affairs without facing penalties or prosecution. By voluntarily disclosing any previously unreported assets and income, taxpayers can resolve past tax irregularities and enjoy a fresh start in their tax compliance journey. 6. Plan Capital Gains Tax (CGT) Considerately: The Act offers certain capital gains tax reliefs, including exemptions for gains from the disposal of securities listed on the Nigerian Stock Exchange. Individuals can structure their investment portfolio to take advantage of these CGT reliefs, minimizing tax liabilities arising from the sale of qualifying assets. 7. Maintain Accurate and Comprehensive Records: Effective tax planning hinges on maintaining meticulous financial records. Individuals should keep accurate and comprehensive records of their income, expenses, and investments. Organized record-keeping ensures that all eligible deductions and exemptions are properly accounted for, enabling individuals to optimize their tax planning strategies. Conclusion: In light of the Nigeria Finance Act 2019, tax planning for individuals has taken on increased importance. By understanding the tax exemption threshold, leveraging tax-deductible expenses, capitalizing on retirement contributions, exploring tax-free investments, participating in VAIDS, planning capital gains tax thoughtfully, and maintaining meticulous records, individuals can navigate the tax landscape more efficiently. As a reputable accounting firm in Nigeria, we advise seeking professional guidance to tailor tax planning strategies to individual circumstances. By implementing informed tax planning and compliance, individuals can secure their financial futures while contributing to the country’s economic development and prosperity. For professional advice on Accountancy, Transfer Pricing, Tax, Assurance, Outsourcing, Company Registration, and CAC matters, please contact Sunmola David & CO (Chartered Accountants & Tax Practitioners) at www.sunmoladavid.com. You can also reach us via WhatsApp at +2348038460036.

Introduction: The Nigeria Finance Act of 2019 marked a significant milestone in the country’s tax landscape, introducing sweeping changes to corporate taxation. Aimed at promoting economic growth, enhancing tax compliance, and improving the ease of doing business, the Act had a profound impact on businesses operating in Nigeria. As a leading accounting firm in Nigeria, we delve into the key provisions of the Nigeria Finance Act 2019 and their far-reaching impact on corporate taxation. 1. Value Added Tax (VAT) Rate Increase: Arguably one of the most notable changes in the Finance Act 2019 was the increase in the Value Added Tax (VAT) rate from 5% to 7.5%. Effective from February 1, 2020, this adjustment impacted businesses across various sectors. Companies had to recalibrate their pricing strategies to accommodate the higher VAT rate, while consumers experienced a slight rise in the cost of goods and services. The increase in VAT collection bolstered government revenues, enabling the provision of essential services and infrastructure. 2. Expansion of VAT Coverage: To broaden the tax base and increase VAT revenue, the Finance Act 2019 expanded the scope of goods and services subject to VAT. Items that were previously exempted, such as lease rentals, aircraft maintenance, and passenger transportation services, were now included in the VAT net. This expansion led to increased compliance and enhanced tax collections, contributing to the government’s revenue generation efforts. 3. Tax Exemption Threshold for Small Businesses: In a bid to support and stimulate the growth of Small and Medium Enterprises (SMEs), the Act raised the tax exemption threshold for Companies Income Tax (CIT) from turnover of 5 million Naira to 25 million Naira. SMEs with an annual turnover of 25 million Naira or less are now exempt from paying CIT. This measure aimed to alleviate the tax burden on smaller businesses, fostering entrepreneurship and encouraging job creation in the SME sector. 4. Minimum Tax Exemption: The Finance Act 2019 granted relief to companies with low turnover by exempting those with an annual gross turnover of 25 million Naira or less from Minimum Tax. Minimum tax is typically calculated based on a percentage of gross turnover and applies regardless of profitability. This exemption provided a breathing space for small businesses during their early stages of growth, allowing them to channel resources towards expansion and innovation. 5. Tax Incentives for Pioneer Industries: To encourage investments in industries deemed critical to Nigeria’s economic development, the Finance Act 2019 extended the pioneer status incentive to qualifying businesses. Companies granted pioneer status enjoy a tax holiday for an initial period of three years, exempting them from corporate income tax. This incentive aimed to promote innovation and attract investments in priority sectors, contributing to job creation and economic diversification. 6. Export Expansion Grant (EEG) Scheme: The reintroduction of the Export Expansion Grant (EEG) scheme under the Act provided incentives to companies engaged in non-oil exports. EEG grants are based on the value of non-oil export volumes, encouraging businesses to explore international markets and diversify their revenue streams. This measure aimed to boost Nigeria’s export capacity and reduce reliance on oil revenues. 7. Digital Services Tax (DST): The Finance Act 2019 introduced the Digital Services Tax (DST) to address the challenges of taxing digital transactions. Foreign companies providing digital services to Nigerian consumers without a physical presence in the country are now subject to DST at a rate of 2% of their gross revenue. This provision ensures that multinational digital service providers contribute their fair share to Nigeria’s tax revenue. Conclusion: The Nigeria Finance Act 2019 brought about significant changes to corporate taxation, impacting businesses across various sectors. While the increase in the VAT rate and the expansion of VAT coverage led to increased revenue collection for the government, the Act also introduced several incentives to support SMEs and attract investments in priority industries. As a trusted accounting firm in Nigeria, we advise businesses to stay informed about the provisions of the Finance Act 2019 and its implications for their tax planning and compliance strategies. By leveraging the opportunities provided by the Act and aligning their operations with the new regulations, companies can contribute to Nigeria’s economic growth and prosperity while ensuring compliance with the evolving tax framework. For professional advice on Accountancy, Transfer Pricing, Tax, Assurance, Outsourcing, Company Registration, and CAC matters, please contact Sunmola David & CO (Chartered Accountants & Tax Practitioners) at www.sunmoladavid.com. You can also reach us via WhatsApp at +2348038460036.

Introduction: Tax evasion and avoidance pose significant challenges to the Nigerian economy, leading to reduced government revenue and hampering public service delivery. To combat these practices and strengthen the country’s tax system, the Nigeria Finance Act of 2019 introduces several measures aimed at addressing tax evasion and avoidance. As a prominent accounting firm in Nigeria, we explore the key provisions in the Nigeria Finance Act 2019 that tackle tax evasion and avoidance head-on. 1. Introduction of the Digital Services Tax (DST): The Finance Act 2019 addresses the challenges of taxing digital transactions by introducing the Digital Services Tax (DST). This provision requires foreign companies providing digital services to Nigerian consumers without a physical presence in the country to pay DST at a rate of 2% of their gross revenue. The DST aims to capture revenue from previously untaxed digital activities and prevent tax avoidance by multinational digital service providers. Implication: The DST ensures that foreign digital companies contribute their fair share to Nigeria’s tax revenue, reducing the potential for profit shifting and tax avoidance in the digital economy. 2. Controlled Foreign Company (CFC) Rules: The Finance Act 2019 introduces Controlled Foreign Company (CFC) rules to prevent tax avoidance through the use of foreign subsidiaries in low-tax jurisdictions. Nigerian-resident companies that control foreign companies are now required to include the income of those foreign entities in their tax computation. This measure discourages the shifting of profits to tax havens and enhances transparency in multinational corporations’ global operations. Implication: The CFC rules enhance tax enforcement and prevent profit erosion through complex multinational structures, promoting a fair and equitable tax system. 3. Strengthening Transfer Pricing Regulations: The Finance Act 2019 aligns Nigeria’s transfer pricing regulations with international best practices set by the Organization for Economic Co-operation and Development (OECD). Multinational corporations (MNCs) engaged in related-party transactions must now maintain comprehensive transfer pricing documentation to support the arm’s length nature of their transactions. This measure enables tax authorities to scrutinize intercompany dealings and detect potential transfer pricing abuses that lead to tax avoidance. Implication: Strengthened transfer pricing regulations deter MNCs from manipulating prices in related-party transactions, ensuring fair taxation and preventing base erosion and profit shifting (BEPS). 4. Mandatory Country-by-Country Reporting (CbCR): To enhance tax transparency and monitor the global activities of MNCs, the Finance Act 2019 introduces mandatory Country-by-Country Reporting (CbCR). Large multinational groups with a consolidated group revenue above a specified threshold must now disclose financial and tax-related information for each jurisdiction in which they operate. This reporting requirement enables tax authorities to identify potential tax avoidance practices and take appropriate actions to ensure tax compliance. Implication: CbCR empowers tax authorities to analyze the tax risk posed by MNCs’ global operations, allowing for targeted investigations and corrective actions to combat tax evasion. Conclusion: The Nigeria Finance Act 2019 demonstrates the government’s commitment to addressing tax evasion and avoidance, promoting tax transparency, and creating a level playing field for businesses. By introducing measures such as the Digital Services Tax (DST), Controlled Foreign Company (CFC) rules, strengthened transfer pricing regulations, and mandatory Country-by-Country Reporting (CbCR), the Act takes decisive steps towards building a robust and fair tax system. As an accounting firm in Nigeria, we emphasize the importance of understanding and complying with these tax reforms. By aligning their financial strategies with the changes brought about by the Finance Act 2019, businesses can contribute to a transparent and accountable tax system, fostering economic growth and development for the benefit of all Nigerians. For professional advice on Accountancy, Transfer Pricing, Tax, Assurance, Outsourcing, Company Registration, and CAC matters, please contact Sunmola David & CO (Chartered Accountants & Tax Practitioners) at www.sunmoladavid.com. You can also reach us via WhatsApp at +2348038460036.

Introduction Foreign Direct Investment (FDI) plays a crucial role in the economic development and growth of countries around the world. In Nigeria, attracting foreign investment is essential for driving innovation, creating jobs, and enhancing economic diversification. Recognizing the significance of FDI, the Nigeria Finance Act of 2019 introduces key provisions aimed at promoting a conducive environment for foreign investors. As a prominent accounting firm in Nigeria, we delve into the role of the Nigeria Finance Act 2019 in fostering Foreign Direct Investment. 1. Pioneer Status Incentive: The Finance Act 2019 extends the pioneer status incentive to industries and sectors critical to economic growth and development. Foreign companies making investments in pioneer industries can benefit from tax holidays, which provide relief from corporate income tax for an initial period of three years. This incentive encourages foreign investors to consider Nigeria as an attractive destination for their business ventures. Implication: The pioneer status incentive incentivizes foreign companies to invest in priority sectors, driving technological advancements, job creation, and economic diversification. It positions Nigeria as an appealing investment destination, attracting FDI to bolster various industries. 2. Incentives for Export-Oriented Businesses: To enhance Nigeria’s export capacity, the Finance Act 2019 reinstates the Export Expansion Grant (EEG) scheme. This initiative provides incentives to businesses engaged in non-oil exports. Foreign investors contributing to Nigeria’s non-oil export volumes can access grants proportional to their export value. The EEG scheme serves as a powerful tool to attract FDI, especially for businesses keen on exploring international markets. Implication: The EEG scheme motivates foreign investors to invest in export-oriented businesses, facilitating economic growth and contributing to Nigeria’s foreign exchange earnings. It strengthens the country’s competitiveness in the global market and encourages FDI in non-oil sectors. 3. Digital Services Tax (DST): The Finance Act 2019 introduces the Digital Services Tax (DST) to address the challenges of taxing digital transactions. Foreign companies providing digital services to Nigerian consumers without a physical presence in the country are subject to DST at a rate of 2% of their gross revenue. This move ensures that multinational digital service providers contribute their fair share to Nigeria’s tax revenue. Implication: The DST fosters a level playing field for foreign and local digital service providers, encouraging fair competition and promoting FDI in the digital sector. It also provides a transparent framework for taxing the digital economy, making Nigeria an attractive destination for tech-driven investments. 4. Enhanced Tax Transparency and Compliance: The Finance Act 2019 emphasizes the importance of tax transparency and compliance. Foreign investors seek stable and predictable tax regimes, and the Act strives to provide clarity in tax regulations. The introduction of measures such as electronic stamp duties for document authentication simplifies tax administration and enhances transparency for foreign investors. Implication: A transparent and efficient tax system instills confidence in foreign investors, assuring them of a business-friendly environment. By reducing tax uncertainties and promoting compliance, Nigeria becomes an appealing destination for FDI. Conclusion The Nigeria Finance Act 2019 plays a pivotal role in promoting Foreign Direct Investment by offering attractive incentives, fostering tax transparency, and streamlining tax administration. By providing tax holidays through the pioneer status incentive, offering grants under the Export Expansion Grant (EEG) scheme, introducing the Digital Services Tax (DST), and enhancing tax transparency and compliance, the Act positions Nigeria as an enticing investment destination. As an accounting firm in Nigeria, we recognize the significance of these provisions in attracting foreign investors. By leveraging the opportunities provided by the Finance Act 2019, Nigeria can enhance its global competitiveness, accelerate economic growth, and solidify its position as an investment hub in the region. For professional advice on Accountancy, Transfer Pricing, Tax, Assurance, Outsourcing, Company Registration, and CAC matters, please contact Sunmola David & CO (Chartered Accountants & Tax Practitioners) at www.sunmoladavid.com. You can also reach us via WhatsApp at +2348038460036.