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FIRS asks General Electric for proof of $2m tax remittance

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The Federal Inland Revenue Service (FIRS) has asked General Electric (GE) International Operations Nigeria Ltd to show proof that it remitted the excessive tax it withheld from Arco Group Plc, a Nigerian oil servicing company, for nine years.
According to an online medium, GE withheld tax of over $3 million from its payments to Arco for services rendered between 2006 and 2015.
GE was said to have deducted 10 per cent as withholding tax for a servicing contract from 2006 to 2015 — as against the percent stipulated by Nigerian laws.
Arco had petitioned FIRS seeking explanation over the deductions, and the FIRS Chairman, Mr. Babatunde Fowler, wrote to confirm that the rate for technical services was five per cent while the one for rental accommodation was 10 per cent.
Not satisfied with Fowler’s response, GE engaged the services of tax consultants, PricewaterhouseCoopers Ltd, who insisted that what Arco offered was “technical services” and the appropriate rate was 10 per cent.
PwC contended that Arco’s services rendered by manpower were technical in nature because of the involvement of “craftsmen” and “technical specialists”.
In the letter written by Chijioke Uwaegbute, PwC’s director of tax and regulatory services, the consultants said in the event that FIRS maintained its position that five per cent was the applicable rate, the tax authority should confirm the treatment of the excessive deductions.
Fowler, in his response dated July 26, 2018, said the FIRS circular in question classified the supply of personnel, personnel protective equipment and uniforms, office equipment and furniture, vehicles and fuelling as contained in the contract document could only be charged five per cent withholding tax (WHT).
The deductible rate for site accommodation or rent, he said, was 10 per cent.
Fowler then demanded evidence that GE remitted the WHT deducted from Arco over the nine-year period.
Arco can apply for a refund of the excess deduction, he said, “so long there is evidence of remittance to FIRS account”.
He further said GE must make available to Arco “all outstanding WHT Credit Notes in respect of remittances made in its favour”.
General Electric previously told the online medium that it would not comment “due to the confidentiality provisions” governing the contract it had with Arco.
The sums in contention are €56,577.61, $2,923,642.36 and N360,482,041.19.

Energy

FG committed to implementing CNG Keke policy – NOA

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The Director-General of National Orientation Agency (NOA), Malam Lanre Isa-Onilu, on Friday restated the Federal Government’s commitment to implementing Compressed Natural Gas (CNG) Keke (tricycle) policy.

Isa-Onilu, who said this on Friday at a news conference in Abuja, said that the policy was part of government’s efforts to alleviate the current economic hardship facing the citizens.

Compressed Natural Gas (CNG) is a feasible gaseous fuel that is relatively very cheap, environmentally friendly, safe to handle and has abundant available energy.

The director-general added that the policy also geared towards cutting  transportation cost, to ameliorate the suffering of citizens.

According to him, the CNG will offer opportunity to local farmers to move their crops at affordable cost from their farms to the market.

“CNG will reduce fuel dependency and scarcity within the country by a wide margin, as well as strengthen uniformity of national transit system.

“Government will deploy 10,000 CNG filling stations across the country, while private marketers are also in the process of adding CNG points to their business,” NOA boss said.

According to him, the Federal Government is committed in providing Nigerians with affordable energy options. The use of CNG stands as a testament to this commitment.

“CNG offers cost savings for consumers, businesses, and government operations in ensuring that energy remains accessible to all.

“As part  of our environmental stewardship, the adoption of CNG aligns with the government’s goal to create a cleaner and  healthier nation.

“By choosing CNG over traditional petrol, we reduce harmful emissions such as carbon dioxide (CO2) nitrogen oxides (NOx) and particulate matter,  in contributing to improve air quality and smaller carbon footprint.”

The director-general said that government recognised the importance of utilising domestic resources to enhance energy security, by  the promotion of the use of CNG, sourced locally.

This, he added, would reduce dependence on imported petroleum products, as well as supporting national economic resilience.

He restated the agency’s commitment in leveraging on the cost cutting benefits of this CNG Keke, to ensure that its community orientation mobilisation officers reach out to communities with government messages.

According to him, the agency has partnered with the Ecomead company to enlighten Nigerians on the Compressed Natural Gas(CNG) Keke tricycle policy.

Also speaking, Chief Executive Officer, Ecomead Company, Mr Kayode Zubaim, commended NOA for embarking on government’s CNG campaign programme to ensure Nigerians were updated with the policy.

According to him, the provision of CNG  is apt and will  help to cushion the effect of fuel subsidy removal on Nigerians.

He added that the decision of President Bola Tinubu made Ecomead to wear a thinking cap, to contribute its quarter to the nation’s development.

“After carrying out series of research, we are able to come up with a brand that will use both CNG and patrol.

“But the truth is that it is manufactured to use CNG with the capacity of five kilogramme that rider can manage for minimum of one week.

“CNG is environmental friendly and such will help to reduce Nigerians problems,  especially those in the rural communities and communities transport system.

“With NOA partnering with us, we can get across to all part of the country in making sure Nigerians know about CNG Keke ,” he said.

He added  that the issue  of transportation would drastically reduce with the intervention  of CNG  when Nigerians made use to the product .

Mr Shamrat Sharna, Regional Manager, Simba TVS, said  CNG looked new to Nigeria, but the product has been used all over in India.

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Energy

FCTA uncovers illegal refinery in Abuja

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The Federal Capital Territory Administration (FCTA) has discovered the presence of an illegal oil refining warehouse in Mabushi, Abuja.

The Director, Department of Development Control, Mukhtar Galadima, who spoke to journalists said that the illegal refining site was uncovered during the continuation of the city cleaning exercise.

Galadima disclosed that about three to four plots of land designated for commercial purposes have been converted to an area where oil and diesel are being adulterated and circulated to other parts of the city.

He said that the city sanitation task force will look into the provision of the law and make necessary recommendations to the FCT Administration for further actions on the plots used for the activity.

He added that there was no arrest, but the items used in carrying out the illegal refining have been impounded.

“During the continuation of our city sanitation exercise in Mabushi opposite Mobile filling station on Ahmadu way, we discovered an illegal refining site where oil and diesel are being adulterated, we have done the needful by moving the items to Nigerian Security and Civil Defence Corps.

“From what we have seen so far, about three or four plots of land designated for commercial purposes have been converted to unapproved activities, which we believe the owners are fully aware of. There will be consequences. We are going to look at the provision of the law and make necessary recommendations to the FCT Administration,” he said.

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Energy

Gas production declines despite FG’s N250bn intervention fund to 15 companies — Report

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The Energy Institute report has revealed that the production of natural gas fell last year despite an N250 billion intervention fund provided to fifteen companies.

According to the industry report in partnership with KPMG, Nigeria’s natural gas production dropped by 4 billion cubic feet meters between 2021 and 2022.

The country’s gas production recorded at 39 billion cubic feet meters as of 2012 was on a steady growth and had grown to 49 billion cubic feet meters as of 2020, suddenly crashed 45 billion cubic meters in 2021, and then 40 billion cubic meters last year.

According to the report, “The development happened despite a N250 billion intervention fund by FG through the Central Bank of Nigeria, out of which N130 billion was doled out to 15 companies for the construction of Compressed Natural Gas conversion centres.

“The NGEP was introduced by the Federal Government to make the CNG the fuel of choice for transportation and the Liquefied Petroleum Gas, the fuel of choice for domestic cooking, captive power and small industrial complexes.”

After the flag off of NGEP, the CBN also introduced the N250 billion intervention facility to help stimulate investment in the gas value chain as part of its efforts at stimulating finance to critical sectors of the economy.

The fifteen companies – Dangote Oil Refinery, Nipco Gas Ltd, Nipco Plc, Hyde Energy Ltd, Lee Engineering and Construction Company, Pinnacle Oil and Gas FZE, Transit Gas Ltd, Amalgamated Oil Company Nig Ltd, First Modular Gas Systems Ltd, NOVAGAS Ltd, Greenville Liquefied Natural Gas Company, AP LPG Limited, and MOB Integrated Services Limited, Delta State Government, and Gas Nexus Ltd that received a combined N130 billion, would on Thursday face the Senate Committee on gas chaired by Jarigbe Agom Jarigbe.

The summon letter by the Senate said, “The invited companies are required to appear with their progress reports, stating location or projects and the current status of the projects.”

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