Economy

Oil Industry: PIB Tops Stakeholders’ Concerns

Published

7 years ago

January 4, 2018

Oil Industry: PIB Tops Stakeholders’ Concerns

The nation’s oil and gas industry could get back on its feet this year, according to industry experts, if the critical issues such as the passage of the Petroleum Industry Bill and the concerns in the Niger Delta are properly addressed, ’FEMI Asu reports.

With another year gone without the passage of the Petroleum Industry Bill, industry experts have expressed concern that the bill may suffer serious setback as electioneering kicks off ahead of the 2019 elections.

A key obstacle to the growth of the Nigerian oil and gas industry has been widely described as the regulatory uncertainty caused by the delay in the passage of the PIB.

The bill, which seeks to change the organisational structure and fiscal terms governing the industry, suffered setbacks in the 6th and 7th National Assembly.

Currently before the 8th National Assembly, it was split into four parts — Petroleum Industry Governance Bill, Petroleum Industry Administration Bill, Petroleum Industry Fiscal Bill and Petroleum Host Community Bill — to fast-track its passage into law.

The Senate on May 25, 2017 passed the PIGB, with its President, Dr. Bukola Saraki, saying in September that the upper chamber was working to ensure the passage of the other bills in the fourth quarter of last year.

The Chairman, National PIB Committee, Petroleum and Natural Gas Senior Staff Association of Nigeria and Nigeria Union of Petroleum and Natural Gas Workers, Mr. Chika Onuegbu, stated that the Senate promised to pass the other aspects of the PIB in the first quarter of 2018.

He said, “It is our hope that they will deliver on that promise. Let them see what they can do to make sure that the public hearing on the remaining three bills are done to ensure the passage of the bills in Q1 2018, so that we will know that by Q2, the pressure will be on the President to assent to those bills.

“For Nigerians and those in the industry, we want to see the passage of a PIB that actually addresses the concerns of stakeholders and move the industry forward. We hope that the President and his team should fast-track the reform in the industry by ensuring that the PIB actually becomes law latest by the second quarter because thereafter, politics will take over every other thing that we will do as a country.”

Onuegbu said the outlook for the industry looked bright considering the recent rally in global oil prices.

“So, the next thing is about production, and that is where the issues around the Niger Delta come in; that is where the policies of the Federal Government come in, so that Nigeria will continue to benefit from the gradual recovery in oil prices,” he added.

An energy expert and associate professor, University of Lagos, Dr. Ayoade Adedayo, said, “The outlook does not look all that bright. Although last year, the minister (Kachikwu) was able to get through his policy documents — the national petroleum policy and national gas policy – the problem is that until we pass the PIB, we are still in the same rot, and while we remain in the rot, the industry will not recover; the transparency, governance and investment concerns will continue to haunt us.”

He decried the lack of investment in exploratory activities in the industry in recent years, saying, “If the rig count in a country is low, it shows the country is not healthy, and I think that the health of the sector should be a big concern to all the policymakers.”

“My concern is that because we are moving already into the territory of national elections, there is no way the National Assembly people will be focused enough to drive this legislation through,” Adedayo said.

The Vice President/Head of Energy Research, Ecobank, Mr. Dolapo Oni, said the industry had gone through a lot in recent times, adding, “The key things we are looking forward to in 2018 are regulatory changes. We expect all the various bills that are at different stages to gain some traction.

“I think people are interested in marginal fields bid round but financing the acquisitions is going to be a challenge.”

The Chief Executive Officer, Gacmork Nigeria Limited and ex-Chevron executive, Mr. Alex Neyin, who stressed the need to create an enabling environment for investors, expressed concern about the management of the industry.

He said, “My major concern is that they don’t have the right people to manage the industry. As long as the government is focusing more on what it can get, they are going to be in trouble. It is very unfortunate that we find ourselves in this mess.

“When you don’t have a defined policy, investment in the industry will be difficult. People want to see clear, definite policies so that when they invest money, they know when they get return on their investment.”

According to an energy expert and Partner at Bloomfield Law Practice, Mr. Ayodele Oni, there is too much vested interest in the PIB.

He said oil production would likely remain high for most of the year with the government trying to impress ahead of the 2019 elections.

“Insurgency may commence in late 2018 in the Niger Delta in a bid to discredit the government ahead of the elections,” he added.

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Samed Olukoya

Is the CEO and Founder of Investors King Limited. He is a seasoned foreign exchange research analyst and a published author on Yahoo Finance, Business Insider, Nasdaq, Entrepreneur.com, Investorplace, and other prominent platforms. With over two decades of experience in global financial markets, Olukoya is well-recognized in the industry.

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Economy

House of Reps Warns Tinubu Against Multiple Tax Burdens on Nigerians

Published

1 day ago

October 12, 2024

Bassey Marshall

Company Income Tax (CIT) - Investors King

The House of Representatives has warned President Bola Tinubu against imposing multiple taxes, levies, and charges on Nigerians already struggling with subsidy removal and higher electricity bills.

During Thursday’s plenary session, the member representing Anambra East/Anambra West Federal Constituency, Mr. Peter Aniekwe, called for the adoption of a motion on urgent public importance.

Investors King reported that the motion was co-sponsored by the House Minority Leader, Rep. Kingsley Chinda, and four others.

In defense of the motion, Aniekwe noted that the government’s introduction of additional taxes, which he described as sometimes unnecessary, only adds an undue burden on Nigerians.

He emphasized the need for the government to strike a balance when imposing taxes that are essential for revenue generation.

Aniekwe said, “The imposition of multiple taxes, levies, and charges at various levels of government only serves to exacerbate the financial strain on citizens, particularly those in low-income brackets, many of whom are already struggling to meet basic needs such as food, healthcare, housing, and education.

“The introduction of additional and sometimes unnecessary taxes, including consumption taxes, service taxes, and levies on essential goods and services, places an undue burden on the masses, further widening the inequality gap.

“While taxation is necessary for government revenue, a balance must be struck between revenue generation and the economic well-being of citizens, particularly at a time when many families and businesses are still recovering from the economic impact of global and local challenges.

“The government’s primary responsibility is to alleviate the economic challenges faced by the masses, ensuring policies that promote economic development, social welfare, and prosperity for all citizens.”

After Aniekwe’s defense, the House of Representatives adopted the motion.

The House cautioned the Federal Government against multiple taxation and mandated the committees on Finance and FIRS to, within three weeks, conduct a thorough review of existing tax laws and policies to streamline tax collection processes and eliminate redundant or overlapping taxes.

The committee was also tasked with identifying areas of double taxation at all levels for necessary action.

Economy

Boosting Nigeria’s Digital Future: STEM Education and AI Could Add $15 Billion to Economy by 2030

Published

1 week ago

October 4, 2024

Ugwoke Ogbodo

If Nigeria can enhance its Science, Technology, Engineering, and Math (STEM) education and prepare its workforce for future opportunities in the digital space, the economy could expand by an additional $15 billion, a new report has revealed.

The report, issued by consultancy Public First on Thursday, also indicated that Nigeria reaped an estimated $1.8 billion in economic benefits from Google’s tools and services in 2023.

Presenting the report in Lagos State, the Nigeria Digital Opportunity study highlighted the financial value contributed to the nation’s economy through services such as Google Search, Ads, Google Play, YouTube, and Google Cloud.

These services have played a significant role in boosting the productivity of Nigerian businesses, content creators, and workers.

It is no secret that a large number of young Nigerians have become tech-savvy, with many venturing into the thriving world of technology and content creation on social media platforms.

According to Google, its digital skills programs and career certificates are key drivers of Nigeria’s digital transformation, with over 1.5 million young Nigerians acquiring new digital skills in 2023.

Google’s Director for West Africa, Olumide Balogun, expressed the company’s satisfaction with the positive impact that digital technology is having on Nigeria’s economy.

He emphasized that the findings highlight the importance of continued investment in digital skills and infrastructure to unlock the full potential of Nigeria’s growing digital economy.

Balogun noted that with rapid digital advancements, particularly in areas such as cloud computing, connectivity, and artificial intelligence (AI), Nigeria is well-positioned to solidify its standing as a leading digital economy in Africa.

He advised the country to strengthen its technology policies, stating that Nigeria’s economic future will largely depend on its ability to harness technology. Balogun added that Google remains committed to supporting Nigeria’s journey through strategic investments and partnerships.

The report underscored the significant role digital technology plays in Nigeria’s economy, with Balogun noting that for every $1 invested in digital technology, the country generates over $8 in economic value.

Meanwhile, Google has called on Nigerian policymakers to prioritize STEM education to maximize the economic benefits of technology.

The report also projected that AI could contribute $15 billion to Nigeria’s economy by 2030.

Balogun highlighted Google’s efforts in promoting responsible AI development, noting that in 2021, the company committed $1 billion to support Africa’s digital economy.

He added that this initiative included the 2022 landing of the Equiano fiber-optic cable in Nigeria, which is expected to boost internet penetration by seven percent by 2025, significantly enhancing internet access and reliability.

Google also recommended that Nigerian policymakers adopt cloud-first strategies and strengthen the country’s digital infrastructure to harness the full potential of AI, while emphasizing the need for improved STEM education to prepare the workforce for future opportunities.

Amy Price, Director and Head of Technology Policy at Public First, praised Nigeria as a digital leader in Africa. She emphasized that tech investment will serve as a catalyst for further growth and development across the nation.

Price further highlighted the critical role AI will play in shaping Nigeria’s future economy, with the report estimating that AI could add $15 billion to the country’s GDP by 2030. She stressed that the nation must focus on building strong digital infrastructure and investing in STEM education to prepare its workforce for the jobs of tomorrow.

Economy

Lawmakers to Deliberate on Nigerian Tax Reform Bills, Change of FIRS to NIRS

Published

1 week ago

October 4, 2024

Iyanuoluwa Martins

The National Assembly is set to begin deliberations after receiving President Bola Tinubu’s communication seeking consideration and passage of the proposed Fiscal Policy and Tax Reform Bill to align with ongoing financial reforms of the Federal Government and enhance efficiency in tax compliance.

In addition to the Senate, the House of Representatives received four bills forwarded by the President. They include the Nigeria Tax Bill, the Nigeria Tax Administration Bill, the Nigeria Revenue Establishment Bill and the Joint Revenue Board Establishment Bill.

The Nigeria Revenue Service (Establishment) Bill seeks to repeal the Federal Inland Revenue Service (Establishment) Act, No. 13, 2007, and establishes the Nigeria Revenue Service, to assess, collect, and account for revenue accruable to the government of the federation.

The Transmission of Fiscal Policy and Tax Reform Bills to the National Assembly is The Nigeria Tax Bill, which seeks to provide a consolidated fiscal framework for taxation in Nigeria.

The Nigeria Tax Administration Bill seeks to provide a clear and concise legal framework for the fair, consistent and efficient administration of all the tax laws to facilitate ease of tax compliance, reduce tax disputes and optimize revenue.

Meanwhile, the Joint Revenue Board (Establishment) Bill aims to establish the Joint Revenue Board, the Tax Appeal Tribunal and the Office of the Tax Ombudsman for the harmonization, coordination and settlement of disputes arising from revenue administration in Nigeria.

This comes after President Tinubu during his speech on Nigeria’s 64th Independence Anniversary on Tuesday (October 1) said some Economic Stabilisation Bills would be transmitted to the National Assembly.

“We are moving ahead with our fiscal policy reforms. To stimulate our productive capacity and create more jobs and prosperity, the Federal Executive Council approved the Economic Stabilisation Bills, which will now be transmitted to the National Assembly.

“These transformative bills will make our business environment more friendly, stimulate investment and reduce the tax burden on businesses and workers once they are passed into law,” he said.

Recently, the Chairman of the Presidential Taskforce on Fiscal Policy and Tax Reforms Committee, Mr Taiwo Oyedele, said the Withholding Tax Regulations 2024 has been gazetted.

“I do have some good news, the good news is that the withholding tax regulation has now been gazetted. So, the only reason it hasn’t been published today is because it is public holiday, so first thing tomorrow you will see a copy of the gazette and that provides a lot of relief not just for manufacturers but also every other business in terms of taking away some of the burdens of funding their working capital,” Mr Oyedele said.

Nigeria has been seeking to harmonise its tax base as it has a tax-to-gross domestic product (GDP) ratio of 10.8 percent; comparatively, the average tax-to-GDP ratio for Africa is about 18 percent.