The House of Representatives has advanced a bill seeking to amend the Companies Income Tax Act to its second reading.
The proposed legislation aims to provide security and guarantees for businesses and companies, particularly regarding the payment of minimum tax during years when they incur financial losses.
Sponsored by Hon. Oboku Abonsizeibe Oforji, representing Yenagoa/Kolokuma/Opokuma Federal Constituency in Bayelsa State, the bill was debated and approved for second reading during Thursday’s plenary session.
The proposed amendment targets Section 33 of the Principal Act, specifically removing the phrase “results in a loss or where a company’s ascertained total profits” from Section 33, Subsection 1. Additionally, it introduces a new Subsection (D) in Section 33(3). The newly added provision states: “Any company in operation that records losses in the assessment year.”
The bill is designed to adjust the framework for assessing companies for tax purposes. Its primary focus is on ensuring that businesses that continue operating but record losses in a given year are exempted from paying the minimum tax stipulated under the Companies Income Tax Act.
If enacted, this amendment would provide much-needed relief for struggling companies, exempting them from minimum tax obligations in years of financial difficulty. The exemption would apply to all qualifying companies during each assessment year.
The move is expected to support businesses in maintaining operations despite financial setbacks, fostering economic stability and encouraging corporate resilience.
