Vice President Yemi Osinbajo has disclosed that multinational digital companies operating abroad with significant economic presence in Nigeria will be subjected to taxation under the new Finance Act.
He revealed only companies that have a physical presence in the country were being taxed previously, adding that the new law had changed this.
Osinbajo made this on Friday, January 31, in Abuja during a lecture titled, ‘Economic Dimension of National Security: The Nigerian Experience,’ organised for participants of Course 28 of the National Defence College.
He said, “So, most digital and multinational technology companies do not have a physical presence in Nigeria, yet make significant income in Nigeria from online activities.
“They pay no tax to Nigeria because they do not have a physical presence in Nigeria, now we are no longer relying on physical presence.”
“Under the new Act, once you have a significant economic presence in Nigeria, you are liable to tax whether you are resident here or not,” he noted, adding that non-residents, who previously had no fixed address would now be taxed under the new Act.
France and the UK have announced their intention to tax companies like Google, Facebook and Twitter but France said days ago it will suspend the plan while international efforts announced at the last World Economic Forum seek to find a global answer.
The US is particularly against the tax understandably because virtually all the firms are American.