oil companies nigeria taxes
Home Industry Oil & Gas Big Oil Companies May Be Evading Taxes in Nigeria – House of Reps
Oil & Gas - 2 weeks ago

Big Oil Companies May Be Evading Taxes in Nigeria – House of Reps

International oil companies operating in Nigeria may be dodging taxes by claiming capital allowances without a Certificate of Acceptance of Fixed Assets (CAFA).

The committee looking into the Structure and Accountability of the Joint Venture (JV) Business and Production Sharing Contracts (PSCs) was looking into Shell Petroleum Development Company of Nigeria, Total Energies, and First E and P. 

This information was revealed during the plenary session on Wednesday by the Nigerian House of Representatives,.

They pointed out that the CAFA certificate served as the foundation for claims for capital allowances.

RELATED:

Nigeria 3rd Largest Oil Producer: How Has it Impacted the Nation?

Oil companies in Nigeria paying taxes that are not sufficient 

The Committee, which was presided over by Rep. Abubakar Fulata, acknowledged that the oil companies in Nigeria that paid taxes to the Federal Inland Revenue Service (FIRS) by Integrated Oil Companies (IOCs) were insufficient because the FIRS does not rely on stock certificates for crude oil and certificates of acceptance for fixed assets.

Reo Fulata also said that the CAFA certificate served as the foundation for capital allowance claims, whilst the stock certificates provided clearer images of the oil being lifted.

The House claimed that “Shell, Total and First E & P were in violation of Nigerian law for making capital allowances claims without the CAFA certificate”.

A stock certificate, capital allowance received, and donations to the NNPC-JV and PSCs Account were used by the IOCs as evidence that they were not only subject to the PT Act but also had no authority to choose which laws to follow and which to ignore.

An overview of Nigeria’s crude oil export 

Nigeria’s crude oil exports increased to a record N11.53 trillion in the first half of 2022, an increase of 39% over $18. 700 billion in the second half of 2021 and an increase of 88.5% over the $13. 800 billion in the same period of 2021.

The highest since the first half of 2019, Nigeria’s crude oil shipments made up 79.5% of all exports during the review period. Nigeria exported goods worth $32.720 billion between January and June 2022, a rise of 81.2% over the same period in 2021.

NEXT:

Ethiopian Air May Back Out of Deal with Nigeria’s Govt

Leave a Reply

Check Also

Greenwich Assists Federal Government to Raise N130 billion

With over N165 billion in subscriptions, Greenwich Merchant Bank Limited, one of the autho…