In a move to boost Nigeria’s energy sector, President Bola Tinubu’s administration has announced new fiscal incentives, including Value Added Tax (VAT) exemptions on key energy products and infrastructure.

These exemptions cover Diesel, Feed Gas, Liquefied Petroleum Gas (LPG), Compressed Natural Gas (CNG), Electric Vehicles, Liquefied Natural Gas (LNG) infrastructure, and Clean Cooking Equipment.

Additionally, the government introduced a Notice of Tax Incentives for Deep Offshore Oil & Gas Production, which provides fresh tax relief for deep offshore projects.

These initiatives are part of the administration’s efforts to revitalize Nigeria’s oil and gas sector.

Wale Edun, the Minister of Finance and Coordinating Minister of the Economy, unveiled these fiscal measures on Wednesday.

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He explained that the VAT exemptions are part of the VAT Modification Order 2024 and the Notice of Tax Incentives for Deep Offshore Oil & Gas Production, both of which align with the Oil & Gas Companies (Tax Incentives, Exemption, Remission, etc.) Order 2024.

A statement released by the Federal Ministry of Finance emphasized that these changes aim to reduce costs in the energy and oil industries, encourage investment in cleaner energy solutions, and support Nigeria’s economic growth.

“These measures are designed to lower the cost of living, bolster energy security, and accelerate Nigeria’s transition to cleaner energy sources.

“In addition, the Notice of Tax Incentives for Deep Offshore Oil & Gas Production provides new tax reliefs for deep offshore projects.”

According to the statement, “This initiative is aimed at positioning Nigeria’s deep offshore basin as a premier destination for global oil and gas investments”.

“These reforms are part of a broader series of investment-driven policy initiatives championed by His Excellency, President Bola Ahmed Tinubu, in line with Policy Directives 40-42,” it added.

“They reflect the administration’s strong commitment to fostering sustainable growth in the energy sector and enhancing Nigeria’s global competitiveness in oil and gas production.”