FIRS Directs Shipping Companies in Nigeria to Settle Outstanding Taxes by Year End

The Federal Inland Revenue Service (FIRS) has issued a directive to all shipping companies conducting operations within Nigeria’s territorial waters, instructing them to resolve any pending tax obligations by December 31, 2023.

According to a press release issued by the FIRS and signed by its Executive Chairman, Muhammad Nami, this announcement follows two previous circulars issued in June and December of 2021. These earlier communications outlined the framework for taxing international shipping firms and urged them to rectify their tax matters with the tax authority within a three-month timeframe.

The circular also highlighted the FIRS’s observation that a considerable number of international shipping lines active in the country have not been adhering to the existing tax regulations of the nation.

“The circular provides the basis of taxation for all international shipping lines in Nigeria and the public notice requested all international shipping lines to regularise their tax affairs with the Federal Inland Revenue Service (FIRS) within three months of the date of that publication”

“Consequently, the Service hereby requests all international shipping companies operating in Nigerian territorial waters in whatever capacity (containerized, bulk cargo, fishing trawlers, crude oil and natural gas lifting vessels, dredging, survey, floating, production, storage, and offloading, etc.) to immediately regularise their tax positions.”

The service noted that it is collaborating with relevant security agencies to prosecute defaulting shipping agencies after December 2023.

The statement reads, “The Service is collaborating with relevant government regulatory and security agencies in the maritime sector to commence enforcement action on defaulting shipping companies after the expiration of the grace period of December 31, 2023”

Federal Inland Revenue Service (FIRS) was created in 1943. Prior to that time, its functions had been performed by the Inland Revenue Department of British West Africa.

The Board of Inland Revenue was created in 1958, and the service gained autonomy with the passing of the FIRS (Establishment) Act 13 of 2007.

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