Nigeria oil and tax reforms may face hurdles

Significance This follows a February executive order authorising the finance minister to introduce additional fiscal incentives to support investment in the sector. The government hopes that new investment will allow Nigeria to boost its oil output and revenues. Meanwhile, the government has also tabled legislation to overhaul the income tax system for additional revenue mobilisation. Impacts The exchange rate may stabilise due to forex backlog clearances, high interest rates and easing pressures linked to the Dangote Refinery. Recently announced tax exemptions may increase electric vehicle imports. Inflation may remain stubbornly high due to food price pressures and increased fuel costs.