Advertising agencies have been advised to evolve their operations by becoming solution providers, complying with regulatory and tax policies and taking cognizance of events in the economy in order to survive the tough business environment.
This was the view expressed by speakers at the 2020 Business Outlook Seminar of the Association of Advertising Agencies of Nigeria (AAAN), which held in Lagos on Tuesday. The event had as its theme: “Nigerian Business Environment in the year 2020: Implication for Advertising Agencies.”
Delivering the keynote address, Mr. Emeka Onwuka, Partner and Head of Andersen Tax LP, explained that the Nigerian economy is projected to grow by 2.4 per cent and flourish in 2020. He attributed the anticipated economic growth to the early passage of the 2020 budget, the enactment of the 2019 Finance Act, stability of oil price in the international market and the growth of the non-oil revenue sectors among others. Onwuka, however, stated that government must be interested and help businesses thrive, adding that economic actors must not take decisions that will negatively affect them and the economy in general.
“You (businesses) can have your own plans for the year, the economic actors are making their own conclusions but when they are done with their conclusions and take actions, it can be overwhelming or underwhelming. But so far, so good, the Central Bank of Nigeria appears to be managing the situation well.
“Government plays a central role in the life of businesses. I always joke that government is an executive holder in every business in Nigeria; so government should be interested in how businesses thrive, government should be out there finding out what problems businesses thrive because it is when businesses thrive, that’s the only time that government should thrive,” he said. He also stated that advertising agencies must be tax compliant and ensure they keep adequate records of all financial transactions in order to avoid the wrath of the tax regulatory agencies.
“The tax law by its nature is dynamic because government are supposed to tax businesses as businesses earn every day. So, it is best practice to update your taxes as the businesses change. One good thing about the change of taxes in the new Finance Act is that government didn’t impose it on us, it was actually done in consultation with the private sector.
“So, the first thing that every business must do is to have a plan to become compliant. Have your own tax strategy and finance strategy because tax does not exist in isolation, tax follows accounting. You must treat tax matters extremely carefully because even if there is a dispute, whoever is mediating would have to see the facts sooner or later,” he said.
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