Nigeria: Tax and regulatory challenges in electricity supply industry
With the introduction of private companies into the electricity supply industry, tax has become a larger issue.
Introduction of private companies into the electricity supply industry
Private companies did not begin to participate in the Nigerian electricity supply industry until about 15 years ago. Prior to then, it was completely under the control of the government and so tax was not necessarily a big issue.
However, with the introduction of private companies into the electricity supply industry, tax has become a larger issue. New entrants and tax administrators are still trying to understand the peculiarities of the electricity supply industry and the peculiar tax challenges associated with it.
Read a November 2021 report [PDF 3.49 MB] prepared by the KPMG member firm in Nigeria that summarizes some of the recent issues, including:
- Effect of Value Added Tax (VAT) (Modification) Order, 2021 on operations of the Nigerian electricity supply industry
- Treatment of interest of unpaid Nigerian Bulk Electricity Trading (NBET) bills by generating companies and distribution companies
- Minimum tax for companies operating in the power sector
The KPMG name and logo are trademarks used under license by the independent member firms of the KPMG global organization. KPMG International Limited is a private English company limited by guarantee and does not provide services to clients. No member firm has any authority to obligate or bind KPMG International or any other member firm vis-à-vis third parties, nor does KPMG International have any such authority to obligate or bind any member firm. The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation. For more information, contact KPMG's Federal Tax Legislative and Regulatory Services Group at: + 1 202 533 3712, 1801 K Street NW, Washington, DC 20006.