Economy
LCCI Welcomes FG’s VAT Exemption, Seeks More Energy Incentives
By Adedapo Adesanya
The Lagos Chamber of Commerce and Industry (LCCI) has lauded the federal government’s decision to exempt cooking gas and diesel from Value Added Tax (VAT) and other incentives in the oil and gas sector.
The body said the steps would lower industries’ operational costs, reduce Nigerians’ overall cost of living, and increase access to clean energy.
Recently, the federal government announced the introduction of incentives, including VAT Modification Order 2024 and notice of tax incentives for deep offshore oil and gas production.
In its reaction, the LCCI said these measures will lower the operational costs for industries, reduce the overall cost of living for Nigerians, and increase access to clean energy.
In a statement signed by the Director General of LCCI, Mrs Chinyere Almona, it highlighted some quick impact fiscal interventions that could ease the harsh economic conditions.
The group also said the transition to Compressed Natural Gas (CNG) mobility would offer an opportunity to make energy more affordable, create jobs, and reduce emissions.
LCCI argued that businesses have been struggling to survive under the tight monetary stance of the government for the past 18 months.
“We acknowledge the significant step towards alleviating the burden on businesses and households by removing the Value-Added Tax (VAT) on diesel and cooking gas.
“This well-considered move will provide immediate relief, especially as these commodities are essential to daily life and economic activities.
“Implementing the VAT Modification Order 2024 and Notice of Tax Incentives for Deep Offshore Oil & Gas Production are significant fiscal incentives that can revitalise Nigeria’s oil and gas sector,” she said.
LCCI recalled that for too long, the high cost of diesel had weighed heavily on the manufacturing sector, logistics, and transportation while cooking gas, a cleaner and healthier alternative for households, had been made less affordable by VAT impositions.
“This policy shift will undoubtedly lower the operational costs for industries, reduce the overall cost of living for Nigerians, and increase home access to clean energy.”
The chamber argued that a successful transition to CNG mobility would require all the possible incentives that could speed up its deployment.
These interventions include tax reliefs for deep offshore oil and gas production that could boost oil and gas sector investments.
“The business community is upbeat about the government’s efforts towards transitioning to Compressed Natural Gas (CNG) as an alternative fuel for mobility.”
LCCI also offered some recommendations that would ensure that the shift to CNG mobility is smooth, efficient, and impactful in reducing costs for the Nigerian people.
The body said that it is critical to establish and expand the infrastructure for CNG refuelling stations across the country to achieve the desired widespread adoption of CNG.
“Currently, access to CNG refuelling points is limited, creating a barrier to adoption.
“The success of CNG mobility depends heavily on public acceptance and understanding of its benefits.
“A comprehensive awareness campaign should be launched to educate citizens and businesses on the cost advantages to individuals, cost savings for the government, and the positive environmental impact of CNG adoption.
“Transitioning to CNG requires vehicle modifications, which can be cost-prohibitive for individuals and small businesses. The government should consider creating incentives or subsidies for vehicle owners to convert their engines to run on CNG.
“The shift to CNG presents an opportunity for job creation in the energy and automotive sectors.
“We need programmes to equip existing mobility entrepreneurs like mechanics, road transport workers, and commercial bus drivers with the necessary skills for CNG-related jobs, from vehicle conversions to infrastructure maintenance and operation.”
LCCI also called for the full implementation of Naira payments for crude oil sales to the Dangote Refinery and other local refineries, which was scheduled to start on October 1, 2024.
“This move will herald a significant milestone in Nigeria’s economic transformation.
“We urge the government to sustain the political will to be consistent with the reforms in the oil and gas sector and implement the Petroleum Industry Act (PIA) fully.
“We see the long-term gains of these reforms if they are implemented under a conducive regulatory environment.
“Removing VAT on diesel and cooking gas is a bold step towards reducing the cost of living for Nigerians, but it is only the beginning.”
By Dipo Olowookere
The Nigerian Exchange (NGX) Limited further suffered a 0.64 per cent decline on Thursday as the bears tightened their grip on the bourse.
For the second straight session, all the key sectors of Customs Street pointed south, with the energy counter down by 5.22 per cent. The insurance index slumped by 2.59 per cent, the banking space depreciated by 0.28 per cent, and the consumer goods segment moderated by 0.06 per cent, while the industrial goods sector was flat, though with a marginal fall.
As a result, the All-Share Index (ASI) contracted by 1,493.71 points to 233,580.83 points from 235,074.54 points, and the market capitalisation retreated by N959 billion to N149.888 trillion from N150.847 trillion.
Investor sentiment remained weak after a negative market breadth index, as there were 21 price gainers and 34 price losers.
Aradel and Deap Capital went down by 10.00 per cent each to N1,575.00 and N4.05, respectively. Trans-Nationwide Express fell by 9.90 per cent to N3.64, Regency Alliance slipped by 9.57 per cent to N85 Kobo, and C&I Leasing dipped by 9.48 per cent to N28.12.
Conversely, Red Star Express grew by 9.60 per cent to N24.55, Legend Internet expanded by 9.09 per cent to N6.00, Neimeth appreciated by 7.10 per cent to N8.30, Abbey Mortgage Bank rose by 5.45 per cent to N8.70, and Ellah Lakes improved by 4.65 per cent to N9.00.
Yesterday, market participants traded 393.7 million equities valued at N19.2 billion in 45,813 deals compared with the 488.1 million equities worth N20.9 billion transacted in 46,239 deals recorded a day earlier, implying a shortfall in the trading volume, value, and number of deals by 19.34 per cent, 8.13 per cent, and 0.92 per cent, respectively.
The most active stock for the session was Access Holdings with a turnover of 39.1 million units worth N896.2 million, Chams traded 24.5 million units valued at N96.5 million, Fidelity Bank sold 24.1 million units for N436.9 million, Sterling Holdings exchanged 23.8 million units valued at N182.2 million, and Zenith Bank transacted 18.9 million units worth N2.1 billion.
By Adedapo Adesanya
The Naira recorded a marginal gain of 43 Kobo or 0.03 per cent against the United States Dollar on Wednesday, June 25, in the Nigerian Autonomous Foreign Exchange Market (NAFEX) to sell for N1,380.11/$1 compared with the previous day’s N1,380.54/$1.
However, the Nigerian currency lost N3.21 against the Pound Sterling in the official market during the session to close at N1,818.84/£1, in contrast to Wednesday’s exchange rate of N1,815.63/£1, and against the Euro, it fell by N3.21 to trade at N1,566.84/€1 versus midweek’s value of N1,563.63/€1.
In the same vein, the Nigerian Naira depreciated against the Dollar at the GTBank FX deck yesterday by N3 to sell for N1,383/$1 compared with the preceding session’s value of N1,380/$1, and at the black market window, it remained unchanged at N1,395/$1.
Interbank FX turnover at the NFEM window surged by about 56 per cent day-on-day to close at $195.371 million from $125.588 million reported on Wednesday, according to data from the Central Bank of Nigeria (CBN).
The Naira continues to feel the impact of rising FX payments and a strong US Dollar amid a sharp slowdown in forex market interventions by the central bank, with more than six weeks of no support for the local currency.
Nigeria’s foreign reserves increased further to $51.142 billion, while oil prices continue to be held in the $70 range by developments in the geopolitical scene.
Meanwhile, in the cryptocurrency market, Bitcoin sank below $60,000 as more than $1 billion in crypto positions were liquidated over the past 24 hours, with longs accounting for $842 million of the damage. About 148,500 traders were wiped out. The largest single position was a $38 million bitcoin-dollar bet on Hyperliquid. It led at $489 million in liquidations and dropped 2.8 per cent to sell at $59,862.61.
Ethereum (ETH) crashed by 5.5 per cent to $1,554.57, Ripple (XRP) declined by 4.8 per cent to $1.03, Cardano (ADA) fell by 4.3 per cent to $0.1433, Dogecoin (DOGE) dropped 3.4 per cent to sell at $0.0745, TRON (TRX) slid 2.2 per cent to $0.3215, Binance Coin (BNB) slumped by 1.8 per cent to $561.34, and Solana (SOL) dipped by 0.3 per cent to $62.94, while the US Dollar Tether (USDT) and the US Dollar Coin (USDC) sold flat at $1.00 each.
By Aduragbemi Omiyale
The gantry price of Premium Motor Spirit (PMS), commonly known as petrol, has been cut down by N50 to N1,125 per litre from N1,175 per litre by Dangote Petroleum Refinery.
The refinery confirmed this development via a statement on Thursday to newsmen.
Dangote Refinery described this downward review of the product’s price as a reflection of its ongoing commitment to ensuring price stability, improving affordability, and supporting Nigeria’s energy security objectives.
It further said it underscores its responsiveness to prevailing market conditions and its efforts to pass on cost efficiencies to downstream partners and consumers.
In the statement, the company said it remains focused on its broader mission of contributing to economic growth, enhancing fuel availability, and fostering a more competitive and sustainable petroleum sector in Nigeria.
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