This rule is designed to ensure that very large and profitable companies pay a baseline level of tax, regardless of incentives or deductions. It applies to companies that meet either of these two criteria:
- Have a local turnover of ₦50 billion or more.
- Are part of a global group of companies with a combined turnover of €750 million or more.
- Scenario: Consider a major tech giant operating in Nigeria. Even if it has significant tax deductions that reduce its standard CIT liability, it must ensure that the final tax it pays is at least 15% of its net income. If its net profit is ₦10 billion, its tax payment cannot be less than ₦1.5 billion.
