More Woes For Nigerians As Presidency Moves To Increase VAT Rate

The current financial woes of the Nigerian is set to get worse as the Presidential Committee on Fiscal Policy and Tax Reforms has put forth a proposal to increase the current Value Added Tax (VAT) rate.  Mr. Taiwo Oyedele the chairman of the committee, has highlighted the need for this change during a policy exposure session.  Currently set at 7.5 per cent, the proposed adjustment aims to restructure the revenue-sharing formula, with states and local governments set to receive a larger portion.  Oyedele stressed the importance of ensuring transparency and neutrality in VAT collection, emphasizing that the burden should fall on the ultimate consumer.  To mitigate the impact on small businesses and the underprivileged, certain essential goods and services would remain exempt from VAT.  He said, “We are proposing that the federal government’s portion should be reduced from 15 per cent to 10 per cent. States’ portion will be increased, but they would share 90 per cent with local governments. “In 1986, we had sales tax collected by states. The military came up with VAT in 1993 and stopped sales tax, so they said it would collect VAT and return 15 per cent as cost of collection, and that is the 15 per cent charged today came about. But we think it is too much. So we must make it transparent and neutral, and this is what over 100 countries where they have VAT are doing. “Nigeria’s economy is more than 50 percent in services and if I just stop at this, many states will be broke because VAT collection will go down by more than 50 percent and it won’t even fly. “So we, therefore, need to adjust the VAT rate upward. We would ensure that it doesn’t affect businesses. The only thing is to look at basic consumption from food, education, medical services, and accommodation will carry zero per cent VAT. So, for the poor and small businesses, no VAT.”

TUC Threaten Nationwide Strike Over Cybersecurity Levy 

The Trade Union Congress (TUC) has threatened a massive protest that will shut down the Nigerian economy should the Federal Government fail to cancel the controversial cybersecurity levy recently introduced by the Central Bank of Nigeria. The TUC in a statement signed by its President, Festus Osifo, on Wednesday, slammed the directive by the CBN to banks imposing a 0.5 per cent cybersecurity levy on almost all electronic transactions. This is after the Nigeria Labour Congress (NLC) had heavily criticised the levy which it described as another burden on Nigerians. Adding to the deluge of condemnations that have greeted the introduction of the levy which the CBN said will take effect in two weeks from May 6, the TUC said it is illogical that this is coming at a time that Nigerians are grappling with the high cost of living that is imposed by the devaluation of Naira, hyper hike in the cost of Petrol, supersonic increment in the cost of electricity tariff, etc. The union said it is disturbed that since the inception of the President Bola Tinubu-led administration, government policies have brought pain, anguish and sorrow to Nigerians. It lamented that account holders in Nigeria are already dealing with multiple taxation from both the Federal Government and the banks. The TUC berated the National Assembly for “colluding” with “elements in the executive” to “exploit” the citizens they ought to be protecting. Saying that all Nigerians are interested in right now is the urgent conclusion of discussions around the minimum wage and not a “vexatious policy”, the TUC urged the Federal Government to immediately direct the CBN to withdraw the circular to banks and cancel the levy forthwith. It said that it will be left with no option but to mobilize all its members, stakeholders and indeed the entire masses “to embark on the immediate protest that would culminate into the total shutdown of the Nigerian economy as this is one exploitation too many.”

Sultan Urges Muslims To Look Out For New Moon

Sultan of Sokoto, Alhaji Muhammad Sa’ad Abubakar III, has urged the Muslim Ummah to start looking for the new moon of Zul qa’ada from Wednesday, May 8, which is equivalent to 29th Shawwal 1445 AH. The Sultan is also the President-General of the Supreme Council for Islamic Affairs in Nigeria. His call was contained in a statement issued in Sokoto by Chairman, Sultanate Advisory Committee on Religious Affairs, Professor Sambo Wali Junaidu. The Sultan further called on Muslims to report the sighting to the nearest District Head for onward communication to the sultanate council. The statement read: “This is to inform the Muslims Ummah that Wednesday, 8th May, 2024 which is equivalent to 29th day of Shawwal 1445 AH, shall be the day to look for the new moon of Zulqa’ada 1445 AH. “Muslims are therefore requested to start looking for the new moon of Zulqa’ada 1445 on Wednesday and report its sighting to the nearest village or district head for onward communication to His Eminence, Alhaji Muhammad Sa’ad Abubakar CFR , the Sultan of Sokoto.”

Senate Moves Forward with Bill to Protect Domestic Workers and Employers

In response to the escalating cases of abuse and exploitation faced by domestic workers in Nigeria, the Nigerian Senate has taken a significant step forward by advancing a bill aimed at protecting the rights of domestic workers and their employers. Sponsored by Senator Hussaini Babangida of the People’s Democratic Party (PDP) representing Jigawa State, the bill passed its second reading on Wednesday following a comprehensive presentation of its core principles during plenary sessions. Senator Babangida emphasized the urgent need for legislative intervention, stating, “Over the years, there has been an increase in the incidents of assaults and abuse of domestic workers by their employers or hosts. These abuses ranged from slave labor, physical abuse, and sexual abuse among others.” He further highlighted the vulnerability of domestic workers in the informal sector, noting, “They are unionists and they do not have a collective platform to speak for themselves and therefore remain ostensibly vulnerable and helpless.” Addressing concerns about crimes involving domestic workers, Babangida pointed out, “On the other side of the coin, is the rise in the state of complicity of crimes committed by domestic workers mostly in connivance with other criminal elements of society against their employers or host. These bother on burglary, kidnapping, stealing of children, and sometimes outright murder.” The bill aims to document and safeguard the rights of domestic workers while also considering the security concerns of their employers, particularly in rapidly urbanizing cities such as Port Harcourt, Lagos, Abuja, and Kano. President of the Senate, Godswill Akpabio, referred the bill to the Committee on Labour and Productivity for further legislative inputs after it successfully passed its second reading. It is expected to return to plenary for deliberation in four weeks. Also in a related development, a bill seeking to amend the Chartered Institute of Accountants of Nigeria (ICAN) Act also progressed with its second reading at the Senate. Presented by Senator Solomon Adeola (APC-Ogun), the bill proposes amendments to strengthen ICAN’s collaboration with other professional bodies and regulatory authorities, both domestically and internationally. Adeola highlighted the necessity of updating the ICAN Act to align with the evolving needs of chartered accountants and the changing economic landscape. “The act empowered the Institute to set standards and regulate the practice of Accountancy in Nigeria,” he stated. Following the second reading, the bill was referred to the Committee on Establishment and Public Service for further legislative inputs and is expected to return to plenary for consideration in three weeks’ time.

Tinubu Returns To Nigeria 

After a two-week absence from the country, President Bola Tinubu returned to Abuja early today, where he was greeted by top government officials.  Tinubu’s diplomatic journey commenced with an official visit to the Kingdom of the Netherlands on April 23, at the invitation of Prime Minister Mark Rutte. During his time in the Netherlands, Tinubu held discussions with prominent Dutch officials, including separate meetings with King Willem-Alexander and Queen Maxima. Additionally, he participated in the Nigerian-Dutch Business and Investment Forum. Following his engagements in the Netherlands, the President attended a special World Economic Forum meeting in Riyadh, Saudi Arabia, from April 28 to 29. The forum, themed “Global Collaboration, Growth, and Energy for Development,” convened leaders from various sectors to discuss global development strategies. However, after the conclusion of the summit on April 29th, the President’s whereabouts remained undisclosed, with the presidency providing no information while speculation arose regarding a potential private visit to Europe following his time in Saudi Arabia.

Bolt sacks 22 Nigerian workers

Bolt Nigeria, a technology-driven ride-hailing platform, on Tuesday said its restructuring efforts affected 22 employees that were laid off. The firm’s Communications Manager, Femi Adeyemo, confirmed this to our correspondent on the telephone on Tuesday. Adeyemo emphasised that Bolt Nigeria is not facing financial difficulties but is instead undergoing a restructuring process. “22 people out of 45 from a department were relieved of their jobs, not nearly half as claimed by some reports. “The department where it happened has 45 workers, not the whole Bolt. That number is not half of the workforce of Bolt,” he said. “The affected employees will receive comprehensive severance packages to support their transition to new career opportunities,” Adeyemo added. Subsequently, the e-hailing firm shared a statement that read, “Bolt has never done and is not doing any layoffs, which implies massively downsizing the team because the company is struggling financially. We have made the difficult decision to discontinue collaboration with 22 employees in Nigeria. “This decision comes as we have been going through the process of restructuring a considerable number of customer support and operational processes in the country. We have offered the people who will be leaving us severance packages that will support their transition to new career opportunities. “This decision does not affect the quality of our products for riders and drivers. We see great potential in Nigeria, and we will stand by our investment commitments in all our African markets.”

Comedian Seyi Law knocks Tinubu government over Cybersecurity Levy

Comedian Seyi Law has taken to social media to knock the Tinubu administration over the new cyber security levy. The Central Bank of Nigeria (CBN) had issued a directive to all banks and financial institutions to implement a cybersecurity levy on banking transactions. This new levy, set at 0.5% of the value of all electronic transactions, was in response to the escalating concerns over cyber threats and follows the guidelines of the recently enacted Cybercrime (Prohibition, Prevention, etc.) (Amendment) Act 2024. Reacting to the development, Seyi Law wrote: “I hate when government agencies don’t speak up to the understanding of the citizens and allow wrong narratives to fester before tackling it. Cybersecurity level, according to the act, is 0.005%, and different figures from 0.5% to 3% are being thrown around. “A 0.5% charge in the Nigeria of today is in itself too much punishment on Nigerians. Are we trying to discourage banking transactions again and encourage cash keeping? @cenbank should revisit this abeg. “Stamp duty is something, and now this. It is unacceptable. @NGRPresident @officialABAT, let the poor breathe. When will the new minimum wage be announced and implemented? Some of your ministers need to look for another job. One year is here and we are counting”.

Central Bank of Nigeria Mandates Registration of All PoS Operators with CAC

In a bid to tackle fraudulent activities and bolster transparency within the financial sector, the Central Bank of Nigeria (CBN) has issued a directive requiring all point-of-sale (PoS) operators to register with the Corporate Affairs Commission (CAC) within a two-month timeframe. According to reports, PoS terminals have been implicated in a significant portion of fraud incidents, accounting for a staggering 26.37% of such cases in 2023 alone. This move by the CBN seeks to address these concerns and ensure the integrity of transactions conducted through PoS systems. With Nigeria boasting 1.8 million PoS agents as of 2022, the directive mandates that all operators must undergo registration with the CAC to continue conducting business in the country. The announcement came following a meeting between representatives from the fintech industry and Hussaini Magaji (SAN), the Registrar-General/Chief Executive Officer of the CAC, held in Abuja on Monday, May 7th. Magaji emphasized that the registration deadline of July 7th is in accordance with legal obligations and aligns with the directives of the CBN. “The Corporate Affairs Commission and Fintech companies in Nigeria, better known as PoS operators, have agreed to a two-month timeline to register their agents, merchants, and individuals with the CAC in line with legal requirements and the directives of the Central Bank of Nigeria,” stated Magaji. The collaborative effort between the CAC and fintech companies underscores the commitment to regulatory compliance and the promotion of a secure financial ecosystem in Nigeria.

Electricity tarrif : NLC, TUC insist on Sunday deadline to reverse hike

Nigeria Labour Congress(NLC) and Trade Union Congress of Nigeria(TUC) have given the Nigerian Electricity Regulatory Commission(NERC) till May 12 to withdraw the recent hike in electricity tariff or face unprecedented industrial action. The ultimatum was issued in a joint letter to the Chairman/Chief Executive Officer, CEO, was copied to the Secretary to the Government of the Federation, SGF, the Ministers of Labour and Power and the electricity distribution companies, DisCos, among others, Joe Ajaero and Festus Osifo, President of NLC and TUC respectively. The letter read: “This is to refer you to our May Day address where we expressed grave concerns regarding the recent announcement of an astronomical hike in electricity tariff across the nation from N65/kWh to N225/Kwh by your commission. ‘’We believe that this decision is not just morally reprehensible considering the difficulties Nigerians are faced with currently, but it blatantly disregards fundamental principles and statutory obligations. ‘’It is a slap in the face of justice and fairness, and we will not stand idly by as the masses and workers are subjected to such unacceptable exploitation. “As the regulator of the electricity sector, it is imperative that your commission grasps the weight of its responsibilities. NERC’s role entails the regulation of electricity tariffs in the country, a duty outlined in explicit detail within the statutes governing the commission. ‘’Yet, with this recent tariff hike which you have acquiesced, it is evident that the Commission has forsaken its duty and abandoned the people it was meant to protect to the fat cats in the electricity industry. “We are miffed that NERC has become a tacit collaborator in crafting the oppressive pricing regime being perpetuated against Nigerian workers and people. The Laws that set up the commission mandate it to act as an unbiased ombudsman in the electricity industry. ‘’Unfortunately, the reverse is the case as it has acted in cahoots with the Distribution Companies, DisCos and the Generating Companies, GenCos, to promote their nefarious market practices. “The announced tariff hike not only defies the established procedure mandated by law but also tramples upon the rights of Nigerian citizens. It is a flagrant abuse of power and a clear violation of the trust bestowed upon your commission by the Nigerian people. Such actions will not be tolerated, and we refuse to accept them as the new norm. “Nigerian workers and masses led by the Nigeria Labour Congress, NLC, and the Trade Union Congress of Nigeria, TUC, stand united in denouncing this injustice. We must defend the rights of our fellow citizens against exploitation. “Therefore, we demand an immediate reversal of the hike in electricity tariff to N65/kwh, immediate cessation of the discriminatory practice of segregating electricity consumers into arbitrary bands, and restoration of the supremacy of the statutes governing the conduct of operators within the electricity industry. “We give you until Sunday, May 12, 2024, to comply. Failure to do so will result in swift and decisive action on our part as we will not hesitate to mobilize our members and occupy all NERC’s offices and those of the DisCos nationwide until justice is served.”

More Burden on Nigerians as the Central Bank Slams Another Tax on Bank Customers

It will seem like there may be no respite soon for the toiling mass of Nigerians as they continue to be bombarded by all manners of taxes, tariffs and levies by the government and service providers with the latest being the introduction of a 0.5 per cent “cybersecurity levy” by the Central Bank of Nigeria (CBN). Earlier in the day, First Bank Nigeria Plc led others in the reintroduction of two percent processing charge on deposits above N500,000 and three per cent charge on amounts above N3,000,000 for corporate customers. The reintroduction of these charges is coming about four months after the Central Bank of Nigeria suspended such charges for cash deposits above N500,000. In a circular signed by Chibuzor Efobi, Director of Payments System Management and Haruna Mustafa, Director of Financial Policy and Regulation, the CBN said collection of the new levy shall commence in two weeks from yesterday, May 6th, 2024 and it shall be remitted to the Office of the National Security Adviser (ONSA). Even though the apex bank was silent on the use into which the ONSA will put the proceeds of the new tax to be paid by bank customers, it explained that deduction and collection of the cybersecurity levy is consequent upon the enactment of the Cybercrime (Prohibition, Prevention etc) Amendment Act of 2024. It was explained in the circular that Section 44 (2)(a) of the Act, provides for the collection of “a levy of 0.5% (0.005) equivalent to a half percent of all electronic transactions value by the business specified in the second schedule of the Act, is to be remitted to the National Cybersecurity Fund (NCF), which shall be administered by the Office of the National Security Adviser (ONSA).” It was further stated that the CBN shall rely on commercial, merchant, non-interest and payment service banks, as well as mobile money operators for the collection of the levy. It also stated that any defaulting institution that fails to remit funds collected shall be liable to a fine of not less than two percent of the annual turnover of the defaulting business. “Deductions shall commence within two (2) weeks from the date of this circular for all financial institutions and the monthly remittance of the levies collected in bulk to the NCF account domiciled at the CBN by the 5th business day of every subsequent month,” the bank stated.