The federal government has unveiled two fiscal incentives aimed at revitalising Nigeria’s oil and gas sector.
Minister of finance and coordinating minister of the economy Wale Edun disclosed the new incentives in Value Added Tax (VAT) Modification Order 2024.
In the policy order, the government said it has given tax incentives for deep offshore oil & gas production, in accordance with the Oil & Gas Companies (Tax Incentives, Exemption, Remission, etc.) Order 2024.
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 director of information in the finance ministry, Mohammed Manga said in a statement on Wednesday.
In addition, the notice of tax incentives for deep offshore oil & gas production provides new tax reliefs for deep offshore projects. The government stated that the 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.
“With these bold initiatives, Nigeria is firmly on track to reclaim its position as a leader in the global oil and gas market. These fiscal incentives demonstrate the administration’s unwavering commitment to fostering sustainable growth, enhancing energy security, and driving economic prosperity for all Nigerians,” Manga said.
