Nigeria, Gambia begin negotiation for Double Taxation Agreement
Representatives of the Nigerian and Gambian governments are meeting in Abuja, the Nigerian capital for negotiations on Double Taxation Treaty between the two countries.
Representatives include officials from Nigerian and Gambian revenue authorities, their ministries of finance and Justice. Samba Sallah, the Deputy Commissioner, Domestic Taxes of Gambia Revenue Authority is leading the Gambian Delegation while the Executive Chairman of the Federal Inland Revenue Service (FIRS) is leading the Nigerian delegation for the negotiation meeting which will last from Tuesday to Friday.
Nigeria and Gambia share a lot of trade together in banking and finance, transportation, education and security.
Securing Double Taxation Agreement between the two countries will ensure protection of trade and participants in Nigeria and Gmabia from double taxation
Double taxation agreements specify which country has taxing rights over an individual, and, if they both have such rights, which one takes priority. The agreements may set down different rules for different types of income. They may also agree to exempt some income or gains from tax or allow a set-off.
In order to promote world-wide economic development and to lessen the effects of double taxation on companies, the Organization for Economic Cooperation and Development (OECD) and the United Nations developed model Conventions (model double tax treaties) on Income and Capital. These models define the principles of permanent establishment, allocates taxing rights amongst nations and provides basis of information sharing and dispute resolution between contracting states.
In Nigeria, the OECD model has served as the basis on which most of the current double taxation treaties (DTTs) with other countries have been formulated. Nigeria currently has DTTs with thirteen countries namely: The United Kingdom, The Netherlands, Canada, South Africa, China, Philippines, Pakistan, Romania, Belgium, France, Mauritius, South- Korea and Italy. All the treaties are comprehensive except the treaty with Italy which covers Air and shipping agreement only.
When an Agreement is reached, it will also require the passage into law by the Nigerian and Gambian parliaments to have the force of law.
Double taxation agreements specify which country has taxing rights over an individual, and, if they both have such rights, which one takes priority. The agreements set down different rules for different types of income. They may also agree to exempt some income or gains from tax or allow a set-off of tax paid in one country against tax due in the other.