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Both local and foreign firms are subject to federal, state, and local taxes, but there are a number of tax incentives for investors. Kaduna State’s One Stop Investment Center can provide information on taxes, tax incentives, and how to apply for tax concession status. The Kaduna State Board of Internal Revenue (www.kadunabir.gov.ng), The Federal Inland Revenue Service (www.firs.gov.ng), and the Chartered Institute of Taxation of Nigeria (www.citn.org) provide more information online.
Federal Taxes
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Type |
Tax Rate (percent) |
Capital gains tax |
10% |
Company income tax (on taxable profit) |
30% |
Value added tax (on land sale and check transactions) |
5% |
Education tax (on taxable profit) |
2% |
Stamp duty (on contracts) |
Individual assessment (varies) |
Petroleum tax (on taxable profit) |
85% (but 67.5% for first 5 years of operations) |
Withholding tax |
Rent: 10%; Dividends: 10%; Interest: 10%; Commission: 5%. |
Training tax (on gross salaries) |
1% on gross salaries |
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State Government Taxes
|
Type |
Tax Rate (percent) |
Business premises permit |
Individual assessment (varies) |
Personal income tax for individuals |
Individual assessment (varies) |
Corporate gains tax for individuals |
Individual assessment (varies) |
Roads tax |
Fixed fee is charged based on the weight of the vehicle |
Stamp duties for instruments |
Individual assessment (varies) |
Development levy (goes toward the development of the State) |
Fixed rate of N100 per year |
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Local Government Taxes
|
Type |
Tax Rate (percent) |
Signboard and Advertisement permit fees |
Varies |
Tenement Rate (of property value) |
0.1% |
Fixed Shop and Kiosk Rates |
Varies |
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Tax Incentives
Kaduna State provides incentives for investors, especially for those utilizing labor, local raw materials, adding local value, and locating in economically disadvantaged areas.
- Local value-added: 10 percent tax concession for 5 years to firms adding value in locality, rather than assembling already produced parts.
- Pioneer status: tax holiday for 5 to 7 years to those firms industries considered beneficial to the country’s economy and operating in the interest of the public e.g. locating in economically disadvantaged areas (wwww.nipc.gov.ng/pioneerstatus.html).
- Local raw material utilization: 30 percent tax concession for five years for industries using mostly local raw materials: 80 percent of agricultural goods; 70 percent of agro-allied goods; 60 percent of chemical products, and 70 percent of petro-chemical goods.
- Local labor utilization: tax concessions are offered to firms offering significant employment opportunities and are determined as follows: industry employing 1,000 people or more receive a 15 percent tax concession; those employing 200 people receive a 7 percent tax concession, and those employing 100 people receive a 6 percent tax concession.
For additional information on tax incentives, see (www.nipc.gov.ng/investment.html).
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Establishing a Business 
