State Commissioner for Commerce & Industry, Hon. Muhammed Muktar Shuiabu, has reaffirmed the Ministry’s readiness to work with the Kogi State Internal Revenue Service (KGIRS) to ensure compliance with the new withholding tax regime and prompt remittance of all statutory deductions.
The Commissioner, who was represented by the Director of Administration, Mr Ejeh Michael, gave this assurance when a team from KGIRS visited the Ministry on Thursday to sensitize management and accounts officers on the new tax reforms as they affect withholding tax.
Director, Account, Mr Mikailu, welcomed the delegation, noting that the Ministry aligns with the State Government’s drive to strengthen and understand the new tax law.
Head of Corporate Tax, Mr Joshua Alori, explained that KGIRS had been mandated to visit all MDAs to sensitize officers on provisions of the new Nigerian Tax Acts and their domestication in Kogi State, with specific focus on withholding tax.
Alori clarified that low-income earners whose annual income is less than or equal to ₦800,000 are exempted from personal income tax, while the first ₦800,000 of every salary earner’s income now enjoys zero percent tax, with subsequent bands charged between 15 and 25 percent.
He also emphasized that withholding tax is not a final tax, but a credit which taxpayers can use to reduce their final liability.
Alori further highlighted key adjustments to withholding tax rates under the reforms, including revised rates on dividends, interest, royalties and rent, as well as professional, management and consultancy fees, also drawing attention to the treatment of directors’ fees and compensation for loss of employment.
He noted that certain small businesses with turnover of ₦50 million and net assets of ₦250 million may enjoy exemptions where transaction values are below ₦2 million, subject to proper financial information being provided, clarifying the distinction between withholding tax and VAT, stressing that while VAT is charged on total invoice value, withholding tax is deducted at source on specified payments.
The KGIRS team placed strong emphasis on timely remittance, explaining that all withholding tax deducted must be remitted on or before the 21st day of the month following deduction, appealing that that failure to deduct attracts a penalty of 40 percent of the amount not deducted, in addition to the outstanding tax, while failure to remit exposes the defaulting MDA or organization to strict sanctions.
With the service fully migrated to digital filing, all remittances will now be uploaded through the State’s electronic platform using the Tax Identification Number (TIN) of each taxpayer.
Participants in all MDAs have already been profiled on the system with unique user IDs and passwords, enabling them to file PAYE, withholding tax and other statutory returns electronically, generate receipts, and allow taxpayers to receive instant alerts and access their own tax credit records.
According to him, “The new system is simple, transparent and nationwide in scope. Ignorance will no longer be accepted as an excuse, because every deduction and remittance can now be tracked in real time.”
Responding on behalf of the Commissioner & Permanent Secretary, Mr Michael appreciated KGIRS for the detailed enlightenment and described the session as timely.
While acknowledging the practical challenges raised by staff regarding staggered contract payments and legacy practices, the DA reaffirmed the Ministry’s determination to comply with all withholding tax, expressing optimism that the collaboration will translate into improved internally generated revenue.
Taiye Bayode
Information Officer
Ministry of Commerce & Industry
