Should SMEs In Nigeria Be Excluded From Transfer Pricing Requirements?

Introduction

As Nigeria continues to navigate the complexities of international taxation, Small and Medium Enterprises (SMEs) are finding themselves at the crossroads. Transfer pricing regulations, which are designed to prevent tax evasion, are imposing significant compliance costs on these businesses. But is it time to rethink the rules? This article explores the potential benefits and drawbacks of exempting SMEs from transfer pricing requirements, considering recent tax reforms such as the finance act 2019 which exempts small businesses with annual revenue of less than NGN 25 million from paying Company Income tax (CIT) and the proposed tax bill which includes companies in the revenue bracket between 25 million and 50 million in the exemption bracket.