*To Raise Joint Committee For Further Review
Moves to resolve the disagreement over the implementation of the new levy by the Financial Reporting Council of Nigeria (FRC) could not be finalised on Wednesday.
Recall that the manufacturing sector and other key stakeholders had opposed the levy.
The major issue bordered on Section 33(1)(c) of the FRCN Act, which stipulates that quoted companies are to pay annual dues based on 0.002% of their market capitalization or ₦25 million, whichever is lower.
Among those that opposed the levy was the Nigeria Employers’ Consultative Association that described FRC imposition of the annual dues on private and non-quoted companies as “outrageous”
NECA had warned that the imposition could cripple businesses and stifle economic growth.
“This outcry follows the implementation of the Financial Reporting Council Amendment Act 2023 (FRC Act), which expanded the scope of companies under the FRC’s regulatory oversight,” the NECA statement had stated.
To resolve the matter the Honourable Minister of Industry, Trade and Investment, Dr. Jumoke Oduwole, on Wednesday convened a stakeholders meeting.
While the Stakeholders wanted outright suspension of the levy, the Minister rejected it and only announced pausing of the Act to allow further review.
She said “A suspension will be a contravention of a legislation that was passed by the National Assembly. A pause is an administrative process simply to review what we have discussed today. And so that’s what we’re going to do, because we are a listening administration.
“The private sector has asked for a range of two to three months fot an indefinite suspension. We are not going to do that.
“So, between now and at most 60 days, we are going to set up a technical working group comprised of FRC and organised private sector representatives.”
According to her, review of the levy can be embarked upon since the the private sector had formally made written submissions.
The Minister went on “The Chairman of the Tax Policy Reform Committee will also be a member of that committee.
“As you can see, it was a cordial conversation. You can see the Head of Nigeria’s organised private sector, you can see the CEO of the Financial Reporting Council, and we have listened because we are a listening government.
“You know, we are a listening government, and we want the private sector to be comfortable. We want the economy to thrive.
"So this is what we are going to do. We have already looked at global best practices on each side, and we will come up with the best for Nigeria.
“We will make the proposition and then, of course, we have to go back to the parliament, wherever we land, it is still going back to the National Assembly.
“We are not going to preempt the discussions and the dialogue between the stakeholders.
“What is clear is that they cannot pay what they used to pay, but they may not pay what they are being asked to pay” she stated
At the meeting, the chairman of the Organised Private Sector, Dele Oye, including the Manufacturers Association of Nigeria (MAN), the Oil Trade Section, and other organisations, had requested for the suspension of the new levy.
Oye had pointed out that the levy would further add to the burden of multiple taxes businesses in the country, which the businesses are already struggling with.
The Director-General of the Nigeria Employers’ Consultative Association (NECA), Adewale-Smatt Oyerinde, warned against more taxes as it could force many companies out of the market.
Since businesses in the country were already struggling to survive, he therefore called for the levy’s suspension.
On his part, the Chief Executive Officer (CEO) of the FRC, Dr. Rabiu Olowo, backed the continued implementation of the levy.
According to him, the levy would enable the Council serve financial entities better.