In the ever-evolving landscape of financial and tax regulations, recent announcements from central banks and revenue authorities shed light on significant developments that impact the compliance landscape. In this compliance news blog post, we explore key updates from Nigeria and Kenya, highlighting regulatory actions, reforms, and initiatives aimed at fostering transparency, trust, and efficiency in financial markets.
1. CBN Unveils FX Market Violations, Pledges Sanctions:
The Central Bank of Nigeria (CBN) has uncovered serious infractions and non-compliance with market regulations by certain foreign exchange operators. Having recently cleared a substantial $2 billion backlog in liabilities, the apex bank is determined to impose sanctions in collaboration with relevant agencies. Mrs. Hakama Sidi Ali, the CBN Acting Director of the Corporate Communications Department, affirms the bank’s commitment to resolving pending obligations, ultimately bolstering the Naira and instilling investor confidence in the Nigerian economy.
2. KRA Streamlines VAT Filing with Pre-Filled Returns:
The Kenya Revenue Authority (KRA) introduces a user-friendly approach to Value Added Tax (VAT) return filing, effective from the January 2024 tax period. Taxpayers will now benefit from pre-filled VAT returns, simplifying the filing process and enhancing the overall user experience. However, the onus remains on taxpayers to confirm the accuracy of the provided information before submitting the return, as the pre-filled VAT return operates on a self-assessment basis. The KRA encourages VAT-registered taxpayers to comply with electronic tax invoicing regulations, anticipating improved tax compliance and system efficiency.
3. FIRS Postpones VAT Guidelines for Non-Resident Suppliers:
The Federal Inland Revenue Service (FIRS) announces a delay in the implementation of simplified compliance guidelines for VAT concerning non-resident suppliers of goods. Originally slated for a January 1, 2024 rollout, the guidelines are postponed due to the FIRS still finalizing the collection and remittance processes. Notably, the guidelines, effective from January 1, 2022, for services and intangibles, lack a specified implementation date for goods, leaving stakeholders awaiting further communication from the FIRS.4. Nigeria’s Ambitious Tax Overhaul Targets 57% Revenue Increase:
Nigeria sets forth a comprehensive plan to revamp its tax system, aiming for a substantial 57% increase in revenue in 2024, targeting 19.4 trillion naira ($20.3 billion). The Federal Inland Revenue Service outlines strategies to enhance efficiency, promote tax compliance, redistribute the tax burden towards the affluent, reduce corporate taxes, and introduce electronic invoicing for value-added tax. These measures align with Nigeria’s broader reform agenda, aimed at stimulating economic growth, alleviating poverty, and funding critical sectors such as infrastructure, education, and health.In summary, these regulatory updates underscore the ongoing efforts of authorities in Nigeria and Kenya to strengthen compliance frameworks, streamline processes, and adapt to the dynamic financial and tax landscape. Stakeholders should stay vigilant and responsive to these changes, recognizing their potential impact on market dynamics and organizational practices.
Stay tuned for more compliance updates by visiting our website, and remember to stay compliant!
Last modified: March 27, 2024
