President Buhari has signed the 2019 finance bill into law. The President announced this on his Twitter handle on Monday, weeks after the Budget was being approved. The new law, among other things, increases the rate of Value Added Tax from 5 percent to 7.5 percent in way of raising government revenue. The law also changes the classification of companies for the purpose of taxation. It classified small companies as those with a turnover of up to ₦25 million and will be exempted from paying income tax while medium companies with a turnover below ₦100 million will pay 20 percent of their profits as income tax while large companies with turnover of over ₦100 million will pay 30 percent income tax. The law also removes the tax exemption on withdrawals from pension schemes except the prescribed conditions are met; emails are to be accepted by the tax authorities as a formal channel of correspondence with taxpayers and the conditions attached to tax exemption on gratuities have been removed. The law aims to increase the tax base by including non-resident companies. It also introduces provisions that create a taxable presence for NRCs carrying on digital activities, consultancy, technical, management or professional services in Nigeria, provided that they have “significant economic presence” in Nigeria, and profit can be attributable to such activity.
The CBN intervened in the foreign exchange market with $253.38 million, under the retail Secondary Market Intervention Sales and CNY16.76 million in the spot and short-tenor forwards segment of the inter-bank foreign market. The intervention, made at the weekend, is the first for the year 2020 in an effort by the regulator, aimed at supporting the monetary policy objectives that are challenged by the weak fiscal environment and low domestic productivity, leading to huge importation. According to the CBN’s spokesman, Isaac Okorafor, the intervention was for requests in the agricultural and raw materials sectors. He assured that the CBN would remain committed to ensuring that all the sectors of the market continue to enjoy access to the needed forex. Meanwhile, the local currency remains stable around ₦360/$ at the Bureau de Change segment of the forex market, while the Chinese Yuan is exchanged at ₦46. CBN Governor, Godwin Emefiele, had listed the bank’s priorities in 2020 to include support for greater economic growth, price stability, and low inflation, hinting the continued tight monetary policy stance of and the establishment of a new scheme; “Bankers’ Charitable Endowment Fund.”
Data from the Nigerian Civil Aviation Authority shows that 11 non-scheduled airlines involved in charter flight services failed to renew their Air Operator Certificates which expired between 2018 and mid-2019. Four of the charter airline’s AOCs expired since 2018 while the remaining seven operators’ certificates expired at different times in 2019. The latest being in August 2019. There are about 39 scheduled and non-scheduled domestic airlines in the country. Thirty of the airlines are charter flight operators while nine are scheduled flight-operators. One charter flight operator’s certificate has been suspended, two are inactive and eight are currently expired. An operator is expected to have its AOC, certificate authorising a firm to perform specific commercial air transport operations either as scheduled or non-scheduled operator, renewed in 90 days upon expiration. Failure to do this renders the airline inactive. According to the NCAA’s spokesman, Sam Adurogboye, the process of getting an AOC to run an airline is rigorous and capital intensive at the initial stage, which was standard practice all over the world. Unlike the initial process, done in five stages, recertification involved mainly paperwork, but delays could come from the applicant if they failed to meet the requirements early. Adurogboye said some of the airlines were already at various stages of renewal but were yet to complete the process. The NCAA had in early 2019 threatened to revoke the AOCs of unauthorised charter flight operators, adding that only holders of valid Air Transport Licence, Airline Operating Permit and AOC were allowed to operate non-scheduled flights. Following the warning, the regulatory agency had gone ahead to list the currently certified charter operators.
Governors in northern states of Nigeria are also making arrangements to float their own regional security outfit following the new security move by their South-West counterparts. Six governors in the South-West had launched the Western Nigeria Security Network, codenamed Operation ‘Amotekun’, to fight security challenges in the region. Governor Simon Lalong of Plateau State said the 19 Northern states have gone far in their efforts to introduce community policing in the region. Lalong, the Chairman of Northern Governors Forum said they had taken a decision last year on the creation of the regional security outfit as all the governors keyed into the idea of community policing, which is still at the level of the committee. He said each state is already neck-deep into the initiative.