Nigeria's Oil Sector Revolution: New Tax Incentives for Cost Efficiency
Nigerian President Bola Tinubu has signed an executive order instituting a framework linking tax incentives to cost savings in the oil sector. This order aims to enhance efficiency and competitiveness. The tax credits provide up to 20% relief on annual tax liability for operators reducing costs, with successful implementation deemed crucial.
Nigerian President Bola Tinubu has enacted a groundbreaking executive order aimed at revolutionizing the oil sector. This new strategy links tax incentives directly to verifiable cost savings, welcoming operators who engage in cost-efficient practices.
The Upstream Petroleum Operations Cost Efficiency Incentives Order 2025 offers tax relief capped at 20% of an operator's annual tax liability, for those successfully implementing cost reductions across onshore, shallow water, and deep offshore fields.
In his statement, President Tinubu emphasized the significance of building an efficient and competitive oil sector in Nigeria, noting the boost in job creation and future security. While the order signifies progress, experts stress the importance of aligning government agencies for effective execution.
(With inputs from agencies.)
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