Electricity tariff hike, withholding tax gazetting… business stories to track this week

Here are the seven top business stories you need to track this week — July 8 to July 12. 

‘FG TO GAZETTE EXECUTIVE ORDER ON WITHHOLDING TAX SOON’

Taiwo Oyedele, chairman of the presidential committee on fiscal policy and tax reforms, says the newly approved withholding tax regulation will be published in the official gazette “in the coming days”.

Withholding tax (WHT) is an advance payment of income tax which may be used to offset or reduce tax liabilities, according to the Federal Inland Revenue Service (FIRS). 

WHT is deducted at varying rates ranging from 5 percent to 10 percent depending on the transaction.

On June 3, Oyedele announced that the federal government has approved the exemption of small businesses earning N25 million and less from withholding tax. 

Giving updates in a post on X on July 2, Oyedele said the approved regulation includes measures to curb evasion and minimise avoidance. 

CBN THREATENS TO PENALISE BANKS REJECTING MUTILATED NAIRA NOTES

The Central Bank of Nigeria (CBN) has threatened to penalise deposit money banks (DMBs) that reject mutilated naira notes.

In a statement on July 4 signed by Solaja Olayemi, CBN’s acting director of currency operations department, the apex bank said several reports have been made against the banks.

The apex bank said it will not hesitate to impose strict sanctions on banks reported to have rejected naira deposits from the public, under any guise.

Also, on July 2, CBN warned banks and authorised foreign exchange (FX) dealers against rejecting old series and lower denominations of dollars.

NNPC DECLARES STATE OF EMERGENCY ON CRUDE OIL PRODUCTION

Mele Kyari, the group chief executive officer (GCEO) of the Nigerian National Petroleum Company (NNPC) Limited, has declared a state of emergency on crude oil production.

Kyari spoke at the opening ceremony of the Nigeria Oil and Gas Conference and Exhibition (NOG Energy Week) held recently in Abuja.

He said war has been declared on the challenges affecting Nigeria’s crude oil production.

Kyari said a detailed asset analysis showed Nigeria could easily produce two million barrels of crude oil per day without deploying new rigs, but the primary obstacle is the inability of industry players to act promptly.

He said the war would enable the NNPC and its partners to remove all identified obstacles to efficient production, including delays in procurement processes, which have become a challenge in the industry.

BAND A CUSTOMERS TO PAY N209.5/KWH AS DISCOS INCREASE TARIFF AGAIN

Nigerian electricity distribution companies have announced a tariff increase from N206.80 per kilowatt to N209.5 per kilowatt-hour (kwh) for premium customers under the Band A category.

In separate statements on July 3, the DisCos said the increase took effect from July 1 and applies to prepaid and postpaid customers.

NIGERIA INTRODUCES 7.5% VAT ON CRYPTO TRANSACTIONS

KuCoin, a cryptocurrency exchange, says it will commence collection of a 7.5 percent value-added tax (VAT) on transaction fees for users in Nigeria.

The company said a regulatory update in Nigeria led to its decision to introduce the VAT.

In a statement on July 3, the cryptocurrency platform said the deduction of the VAT would be effective from July 8.

KuCoin said for every trade, the 7.5 percent VAT will be applied to the transaction fee — not the total transaction amount.

‘OANDO’S ACQUISITION OF AGIP COMPLETED – SIGNING TO TAKE PLACE SOON’

The Nigerian Upstream Petroleum Regulatory Commission (NUPRC) says Oando Plc has completed the acquisition of 100 percent shares of Eni in its subsidiary, Nigerian Agip Oil Company Limited (NAOC Ltd).

In September 2023, Oando Plc announced plans to acquire the NAOC, but the deal was delayed due to regulatory approvals required.

Speaking on July 3 at the NOG Energy Week in Abuja, Gbenga Komolafe, chief executive officer (CEO) of NUPRC, said the signing ceremony of the deal would take place soon.

NIGERIA WINS BID TO HOST $5 BILLION AFRICA ENERGY BANK

The federal government says Nigeria has won its bid to host the headquarters of the $5 billion Africa Energy Bank (AEB).

In a statement on Thursday, Heineken Lokpobiri, minister of state for petroleum resources (oil), described the development as a testament to the country’s leadership and commitment to the energy sector.

The decision, reached at an extraordinary meeting of the Council of Ministers of the African Petroleum Producers Organization (APPO), places Nigeria at the forefront of Africa’s energy future, Lokpobiri said.

He said the AEB would be a cornerstone for financing and advancing energy projects across Africa, promoting innovation, sustainability, and economic growth.