It is no longer news that the dwindling oil revenue has forced the government to increase the pressure on the Federal Inland Revenue Service ("FIRS") to generate more revenue for the government. In response to this increased pressure, the FIRS has challenged the administration of the pioneer tax holiday by the NIPC claiming that the grant of the holiday to some taxpayers is inconsistent with the provisions of the Industrial Development (Income Tax Relief) Act ("IDITRA").
Some taxpayers have received letters from the NIPC cancelling in part, the tax holiday earlier granted to them. Assessment notices have also been issued by the FIRS relying on one or a combination of these three arguments. However, our tax specialists in this publication notes that a taxpayer affected by this development can rely on the doctrine of legitimate expectation to challenge the FIRS or the NIPC.
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