Nigeria has introduced a 15 percent Minimum Effective Tax Rate (ETR) for large domestic companies and multinational enterprises. This move is changing how investors assess returns, dividend sustainability and cross-border tax exposure.
Under Section 57(1)(a) of the Nigeria Tax Act (NTA), qualifying companies must pay a top-up tax where their effective tax rate falls below 15 percent of net income, regardless of incentives, capital allowances or tax planning structures that previously reduced liabilities.
“Minimum effective tax rate is just a way of introducing a minimum tax rate for not just multinationals but for Nigerian companies as well,” said Ajibola Sogunro, tax partner at Forvis Mazars.
