The Chairman of the Federal Inland Revenue Service (FIRS), Zacch Adedeji, has urged non-domestic companies involved in the shipment of crude oil from Nigeria to ensure strict compliance with the country’s tax laws.
Adedeji delivered this message in Lagos during a workshop on the taxation of non-resident shipping companies, a joint effort by FIRS and the Oil Producers Trade Section (OPTS).
He emphasized that the ongoing tax compliance assessment of foreign shipping companies lifting hydrocarbons from Nigeria forms part of the government’s initiatives to expand the tax base and boost revenue.
The FIRS chairman, as conveyed by his Special Adviser on Media, Dare Adekanmbi, reassured international companies of the agency’s focus on enforcing existing tax laws rather than disrupting their operations.
According to the Companies Income Tax Act (CITA) 2004 (as amended), Section 14 mandates foreign companies engaged in shipping and air transport operations in Nigeria to file tax returns to continue their businesses within the country.
Before his appointment as FIRS chairman, Adedeji, the former Special Adviser on Revenue to President Bola Tinubu, referenced his intervention that led to a six-month grace period granted to these companies to regularize their tax returns.
The international shipping companies have until December 31 this year to reconcile their books with FIRS.
Adedeji explained that the workshop aimed to address challenges related to tax compliance by foreign companies and seek lasting solutions.
“The Federal Government has set a target of increasing Nigeria’s tax to GDP ratio to 18% within the next three years. The goal is to achieve this without imposing additional taxes but by broadening the tax net. The compliance exercise on international shipping companies lifting crude oil from Nigeria is in line with this strategy of broadening the tax net.
“I am sure all the international shipping companies that we contacted are aware of the importance of complying with tax laws in the various jurisdictions they operate. Therefore, I urge the international shipping companies that are not complying with Nigerian tax laws to begin to do so immediately,” Adedeji stated.
He further addressed concerns from stakeholders in the oil and gas industry and the maritime sector regarding the tax compliance exercise initiated on international shipping companies lifting crude oil from Nigeria. He assured that the aim is not to disrupt operations but to enforce compliance with Nigerian tax laws.
Adedeji also emphasized the importance of collaborating with stakeholders to address challenges associated with tax compliance, expressing FIRS’ openness to transparent and fair resolutions while also asserting their readiness to enforce Nigerian tax laws without violating taxpayers’ rights if necessary.
The workshop had representatives from the International Association of Independent Tanker Owners (INTERTANKO), International Chamber of Shipping, Independent Petroleum Producers Group, government agencies, and tax advisers, among others, in attendance.
