FG Offers 50% Tax Cut to Encourage Companies to Raise Employee Wages

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FG News

Salaries,Tax

The Federal Government has proposed a 50% tax cut for companies that increase wages or provide transportation subsidies to low-income

employees.

According to the bill, titled “A Bill for an Act to Repeal Certain Acts on Taxation and Consolidate the Legal Frameworks relating to Taxation and Enact the Nigeria Tax Act,” companies that raise salaries to a monthly gross of N100,000 or less or offer transportation allowances will qualify for the deduction.

However, this relief is limited to workers earning N100,000 or below. Additionally, companies that expand their workforce with new hires in 2023 or 2024, leading to a net employment increase, will also qualify, provided the new hires remain employed for at least three years. Companies must apply for this certificate through the Nigerian Investment Promotion Commission . Applications are subject to a 0.1% fee on capital expenditures, capped at N5 million.

 

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