Reactions as Nigeria imposes Police Trust Fund levy chargeable on companies’ net profit.

On the 24th of June, 2019, the president signed into law the Nigerian Police Trust Fund Act. The Act establishes a Fund; proceeds from which will be used to train police personnel and procure security machinery and equipment. The Act imposes a levy of 0.005% of the “net profit” of companies ‘operating business’ in Nigeria. Nigerians and the world have overtime reacted differently to this development. While some argued that 0.005% levy of net profits may not be very significant, many believed that it places additional administration on corporate taxpayers. Prior to this time, business are charged 30% corporate income tax, 2% tertiary education tax and, depending on the industry, 1% information technology development levy and 1% content development fund levy. Introducing this earmarked taxes, experts believe that could further create concerns around the stability of the tax regime in Nigeria. Although improving security is a priority issue, A-FEEDi recommends that it could be funded from already existing revenue streams while improving ease of doing business in Nigeria.

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