Tax Administration
Taxation in Nigeria is managed by the three major tiers of government. Each tier is responsible for collecting different taxes.
The Nigerian tax laws provide for the taxation of businesses, individuals, and corporate entities’ incomes and profits, as contained in the 1999 Constitution’s exclusive legislative list. The tax system is structured hierarchically into Federal, State, and Local Government levels. Each level of government is responsible for administering taxes within its jurisdiction, in line with the Taxes and Levies (Approved List for Collection) Act (LFN 1998 No.2, 1998). Tax Authorities and Jurisdictions The Federal Inland Revenue Service (FIRS) is responsible for administering taxes due to the Federal Government of Nigeria. The taxes collected include:i. Companies Income Tax
ii. Tertiary Education Tax
iii. Stamp Duties
iv. Withholding Tax
v. Value Added Tax
vi. Petroleum Profit Tax
vii. Capital Gains Tax
viii. PAYE (Police, Armed Forces, Foreign Officers)
ix. Police Trust Fund Levy
x. NITDEF Levy
The State Boards of Internal Revenue are responsible for administering Personal Income Tax, fees, rates, levies, fines, and other revenue items due to the State Government, in line with the Personal Income Tax Act CAP P8 LFN 2011 as amended and respective established state administrative laws. The taxes collected include:
i. Personal Income Tax
ii. Withholding Tax (Individuals and Enterprises)
iii. Capital Gains Tax (Individuals and Enterprises)
iv. Stamp Duty (Individuals and Enterprises)
v. Road Taxes
vi. Fines
vii. Fees
viii. Business Premises Registration
ix. Development Levy (Individuals only)
x. Street Naming in the State Capital
xi. Right of Occupancy Fees on Lands Owned by the State Government in Urban Areas of the State
xii. Market Taxes and Levies where State Finance is involved
The Local Governments administer levies within their area councils in line with the approved Taxes and Levies (Approved List for Collection) Act (LFN 1998 No.2, 1998). The levies collected by Local Governments include:
i. Shops and Kiosk Rates
ii. Tenement Rates
iii. Licence Fees
iv. Slaughter Slabs
v. Marriage, Birth, and Death Registration Fees
vi. Street Naming Fees (excluding state capital)
vii. Certificate of Occupancy in Rural Areas
viii. Market Taxes and Levies (excluding markets where state finance is involved)
ix. Motor Park Levies
x. Domestic Animal Licence Fee
xi. Cattle Tax (payable by cattle farmers only)
xii. Merriment and Road Closure Levy
xiii. Radio and Television Licence Fee (other than radio transmitter)
xiv. Vehicle Radio Licence Fees (to be imposed by the local government of the state in which the car is registered)
xv. Wrong Parking Charges
xvi. Public Convenience, Sewage, and Refuse Disposal Fees
xvii. Signboard and Advertisement Permit Fees
xviii. Customary Burial Ground Permit Fees
xix. Religious Places Establishment Permit Fees
xx. Bicycle, Truck, Canoe, Wheelbarrow, and Cart Fees (other than mechanically propelled trucks)