Nigeria and Singapore on Wednesday, signed an agreement on avoidance of double taxation on businesses.
Trade volume between the two countries stood at N846 billion from 2011 to 2015 with the balance tilting in favour of Nigeria at N222 billion.
However, balance of trade net of Petroleum Export stood at N42 billion in favour of Singapore.
Also, foreign direct investment (FDI) from Singapore to Nigeria between 2010 and March 2015 stood at $908.8 million.
Host Minister of Finance, Mrs Kemi Adeosun signed for Nigeria while Singapore’s Senior Minister of state for Trade and Investments Dr Okoh Pohkoon signed for his country.
Adeosun said at the occasion that although both countries have enjoyed steady business relationship, the latest agreement will further strengthen the business bond.
Nigeria and Singapore started s formal Business & Investment Forum in 2013 in addition to a Bilateral Air Services Agreement (BASA) for cargo services which became operational 2012″.
Adeosun added “Singapore was identified as a suitable tax treaty partner for Nigeria because it is currently one of the fastest growing economies in the world with a highly developed and successful free-market economy.
“It operates in a remarkably open and transparent environment, with stable prices, and a per capita GDP higher than that of most developed Countries”, she said.
According to finance minister, possible areas of economic cooperation between Nigeria and Singapore include consumer electronics, information technology products, pharmaceuticals and medical technology products, and financial services, among others.
Avoidance of double tax agreement by the two countries clearly spelt out taxing rights of each other in respect of different income derived from each country.
It’s meant to facilitate inter-state trade, economic and business activities by ensuring that nationals or enterprises of the two states are not taxed twice on the income of profits derived from the other country; to assist prospective investors know their income tax obligation in the other country as well as available tax incentives; and to spell out, clearly tax jurisdiction of each country in respect of all possible areas of business activities which give rise to taxation.
“This Treaty with Singapore is also important because it is consistent with Nigeria’s on-going efforts to expand its treaty network”, she said.
Responding, Singapore’s Senior Minister of state for trade and investments Dr Okoh Pohkoon commended finance minister for ensuring that the agreement held.
He said both countries have had good relationship stating that a lot of Singapore businesses are thriving in Nigeria.
The negotiation for double tax avoidance agreement between Nigeria and Singapore first held in Singapore between 28th to 30th October 2013. It was later concluded in October 2014, after resolving all the outstanding issues.
The Federal Executive Council (FEC) at its meeting of 16th November 2016, approved the text of the agreement and authorised the Honourable Minister of Finance (HMF) to sign the agreement on behalf of Nigeria.
Singapore was identified as a suitable tax treaty partner for Nigeria because it is currently one of the fastest growing economies in the world with a highly developed and successful free-market economy.
It operates in a remarkably open and transparent environment, with stable prices, and a per capita GDP higher than that of most developed Countries.