Greenback shortage causes FIRS to take pity on debtors and allows them to settle their debts in Naira   

11 March 2022: The Federal Inland Revenue Service has given a one-month window to the debtors to settle their outstanding foreign currency tax liabilities in Naira since Greenback has been so hard get a hold of. The concession ends at the end of March, it said.

When the pandemic hit in 2020 and the oil prices plunged, Nigerian companies found it very hard to obtain dollars for importing raw materials or settling taxes. Due to the scarcity of dollars, CBN had to ration the supply of Greenback and devalue the local currency three times in two years.Now that the oil prices have skyrocketed owing to the Russian-Ukraine conflict, the effect of that is yet to trickle down to Nigeria’s dollar supply

Nigerian authorities require companies to pay tax in the currency of the transaction. At the expiration of the one-month window, the tax agency “would no longer entertain any such requests” to settle the obligations in naira, it said.

The concession is available to all taxpayers with foreign currency liabilities due on or before Dec. 31, barring companies in the upstream oil and gas sector, according to the agency. The naira payment will be based on the official exchange rate on the date of the transaction and or when the tax falls due, it said.

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