Introduction

In a bid to bring Nigeria in line with modern economic realities and create more revenue for the country, the immediate past President of Nigeria, Muhammadu Buhari, on the 28th day of May 2023, signed the Finance Act 2023 into law.

The new Finance Act 2023 is a comprehensive legislation that has introduced over thirty (30) amendments to the existing tax legislations in Nigeria, such as the Capital Gains Tax Act, Companies Income Tax Act, Customs and Excise Tariffs, Personal Income Tax Act, Stamp Duties Act, Petroleum Profit Tax Act, Value Added Tax Act and Tertiary Education Trust Fund (Establishment, etc) Act. The Act has also amended certain provisions of the Corrupt Practices and Other Related Offences Act, Public Procurement Act, and the Ministry of Finance (Incorporated) Act. These amendments were made in order to promote economic growth and address existing ambiguities in the various provisions of the laws regulating businesses.

This review summarizes the amendments in respect of the extant tax regimes and their impact on the Nigerian business scene. The term ‘’Principal Act’’ as used in this piece, refers to the primary Act that governs the tax regime applicable to the relevant agencies or transactions, while “Service” refers to the Federal Inland Revenue Service.

Key Provisions of the Finance Act 2023

• A. Capital Gains Tax Act Cap C1, LFN 2004

Capital Gains Tax is the tax imposed on the gains derived from the sale of assets/property, whether by corporate entities or by individuals. Such asset/property is referred to as chargeable assets. Where there is a sale or disposal of an asset or property, tax is therefore imposed on the gains made. The Capital Gains Tax Act is the principal legislation that governs the taxation of such gains and imposes a rate of 10% on any capital gained from a sale by companies and/or private individuals.

1.  Inclusion of Digital Assets as Chargeable Assets
   The Capital Gains Tax Act, pursuant to section 3, provides for chargeable assets. The section provides that subject to any exceptions as contained in the Act, all forms of property shall be assets for the purposes of the Act, whether situated in Nigeria or not, including options, debts, and incorporeal property generally. The Finance Act 2023 has amended the said section by inserting ‘’digital assets’’ after debts.

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