Federal Government of Nigeria has announced that it will be providing value added tax (VAT) exemptions for a range of energy products, which include diesel, Liquefied Natural Gas (LNG), Compressed Natural Gas (CNG), and electric vehicles.
Gatekeepers News reports that this decision is intended to lower prices and is part of the government’s efforts to reduce the cost of living, improve energy security, and accelerate Nigeria’s transition to cleaner energy sources.
The development was disclosed in a statement by the Minister of Finance and Coordinating Minister of the Economy, Wale Edun, on Wednesday.
“The VAT Modification Order 2024 introduces exemptions on a range of key energy products and infrastructure, including Diesel, Feed Gas, Liquefied Petroleum Gas (LPG), Compressed Natural Gas (CNG), Electric Vehicles, Liquefied Natural Gas (LNG) infrastructure, and Clean Cooking Equipment.
“These measures are designed to lower the cost of living, bolster energy security, and accelerate Nigeria’s transition to cleaner energy sources,” the statement read in part.
In addition, the Minister also announced the introduction of tax incentives for deep offshore oil operations and gas production, as outlined in the Oil & Gas Companies (Tax Incentives, Exemption, Remission, etc.) Order 2024.
Edun stated that the initiative is designed to establish Nigeria’s deep offshore basin as a leading destination for global oil and gas investments.
He explained that these reforms are part of a broader set of investment-focused policy initiatives led by His Excellency, President Bola Ahmed Tinubu, in accordance with Policy Directives 40-42.
“In addition, the Notice of Tax Incentives for Deep Offshore Oil & Gas Production provides new tax reliefs for deep offshore projects. This initiative is aimed at positioning Nigeria’s deep offshore basin as a premier destination for global oil and gas investments.
“These reforms are part of a broader series of investment-driven policy initiatives championed by His Excellency, President Bola Ahmed Tinubu, in line with Policy Directives 40-42.
“They reflect the administration’s strong commitment to fostering sustainable growth in the energy sector and enhancing Nigeria’s global competitiveness in oil and gas production” Edun added.
