19 Sep

Daily Watch – FIRS swells corporate tax net by 700k, More power stations go down

  • Nigeria’s economy recorded a $2.1 billion decline in investment inflow in the first 12 months of the Muhammadu Buhari administration. a figure which amounts to ₦642 billion at the official exchange rate of ₦305/$. An analysis of NBS data showed that the country attracted a total investment inflow of $2.75 billion in 2015 2Q; that figure declining to $647.1 million at the end of June this year. All three major investment components, FDI, FPI and other investments recorded huge declines in the one-year period. FDI inflow slowed down to $133.02 million in 2016 2Q from $717.72 million in 2015 3Q. FPI shrunk from $1.09 billion last year to $245.32 million. For other investments including trade credits, loans, currency deposits and other claims, the report showed that $1.02 billion in inflows in 2015 3Q had shrivelled to $268.77 million in 2016 2Q.
  • CBN Governor, Godwin Emefiele says the economy will likely come out of a recession by the fourth quarter of this year when various measures put in place by the FG and the monetary authorities kick in. He briefed media executives in Lagos on Saturday on one such measure, the establishment of a bridge fund for the government to help stimulate the economy. In his words, “We are already in the valley, the only direction is to go up the hill and the government is doing everything possible to ensure that we move up the hill. I am optimistic that based on the actions being taken by the monetary and fiscal authorities, the fourth quarter results will show evidence that we have started to move out of the recession. The worst is over. The Nigerian economy is on the path of recovery and growth. So, please if you are a bystander or sideliner, you are losing; join the train now before it leaves the station.”
  • Power generation fell by over 1,000MW as four power plants went down on Saturday, bringing the total number of plants not generating electricity nationally to 10. Nigeria recorded a total system collapse on Friday, September 16, – the 17th time this year – according to industry data. Total power generation stood at 2,555.7MW as of 6am on Saturday, down from 3,596.2MW the previous day, worsening the outage being experienced by households and businesses across the country. Electricity from the nation’s biggest power station, Egbin in Lagos, hit a record low of 246MW on Saturday from 425MW on Friday, while output from Shiroro in Niger, one of the nation’s hydropower plants, hit a 600MW high. The plants that were shut down after Saturday’s collapse included Olorunsogo I and Olorunsogo II in Ogun; Omotosho II in Ondo; and Ihovbor in Edo, with installed capacities of 294MW, 500MW, 500MW and 225MW respectively. Other plants that did not generate any electricity on Saturday were Sapele I, Afam IV & V, Afam VI, AES, ASCO and Rivers IPP.
  • Nigeria is the seventh largest producer of cocoa in the world, according to a review of new data by the International Cocoa Organisation, a drop from the fourth position during the last review. The Cocoa Association of Nigeria President, Sayina Riman said the review of the rankings was made by the ICO based on the country’s 2015/2016 production projection of 190,000MT. According to ICCO’s numbers, Nigeria was fourth in the 2013/2014 season based on its estimated production output of 230,000MT after Côte d’Ivoire, Ghana and Indonesia. Riman, who said the 2015/2016 season saw about 275,000MT in cocoa produced in the country, expressed optimism that the new planting season would yield between 280,000 and 300,000MT provided production factors were favourable.
  • The FIRS has registered about 700,000 new corporate taxpayers within the past year in a bid to widen the tax net and commenced a voluntary compliance initiative aimed at assisting taxpayers to file tax returns as and when due, calculate their income, expenditure and tax liabilities, Executive Chairman, Tunde Fowler told delegates at the African Tax Administration Forum and IMF seminar in Cape Town. A statement from the service read in part, “The FIRS chairman said that revenue authorities could function with less public service bottlenecks and have access to the resources required to deliver on their mandate for domestic resource mobilisation and funding for governments across Africa”.
  • Conoil recorded a 196 percent increase in its 2016 half-year profit. Its unaudited half-year report filed with the NSE on Friday showed that profit before tax rose from ₦528.5 million in 2015 to ₦1.566 billion in 2016. The firm also saw a 190 percent increase in profit after tax from ₦359.4 million in 2015 to ₦1.04 billion in 2016, while earnings per share rose from 52 kobo to 150 kobo. The company’s results were said to have prevailed against the volatility in the downstream sector of the petroleum industry and an economy in recession, with industry watchers expecting a higher dividend payout for its shareholders at the end of the current financial year.