FEC ratifies bill to fast track implementation
By Jeph Ajobaju, Chief Copy Editor
Senators are still considering the Finance Bill 2021, which passed both First and Seconding Readings at the Chamber on Wednesday, but the Federal Executive Councial (FEC) fast forwarded the same day by ratifying the document.
The bill is on course for passage, at the behest of President Muhammadu Buhari, who wrote to the Senate on Tuesday to give it priority attention. Once he signs it into law, it will become operation in January 2022.
Finance, Budget and National Planning Minister Zainab Ahmed disclosed the ratification to journalists after the FEC meeting at the Villa and explained that the bill focuses on tax as well as review and amendment of 11 fiscal laws.
Rather than proposing new taxes or increasing tax rates, she said, the quest is for closing loopholes and improving tax administration, per Tribune Online.
__________________________________________________________________
Related articles:
Individuals, corporates need TIN to operate bank accounts
Tax reliefs in one year cost federal treasury N5.16tr
CSOs decry social media tax plan by FIRS
CSOs, non-profits, to pay tax. As Buhari extends tax net to pay N35.46tr debt
_________________________________________________________________
Bill focuses on five broad categories
“So, the proposed legislation falls under five broad categories. The first one of course is domestic revenue mobilisation, and various measures are proposed in the bill to enhance revenue,” Ahmed explained.
“These include limited, excellent exemptions of case from shares disposals from capital gains tax to long-term equity investments, out to a close in tax loopholes for companies that are transmitted from the previous federal public tax regime to the world corporate tax and have recovered tax regime that is provided under the new petrol industry act of 2021.
“There are also provisions that have been made to prevent the abuse of Personal Income Tax released by individual taxpayers and allowances to evade taxation.
“This second broad category is Tax Administration Reforms.
“This include provisions to support the FIRS [Federal Inland Revenue Service] ongoing reforms to fully automate and deploy technology to enhance collections and encourage taxpayer compliance and there are several measures in that category.
“The third one is International Taxation Reforms.
“This provision empowers the FIRS to better assess non-resident companies to taxation by taxing profits derived from digital services rendered to Nigerian customers and it’s also designed to reduce the tax compliance burdens on non-resident taxpayers that are not required to register in Nigeria as companies.
“The fourth broad objective or the Finance Bill is financial reform to enhance tax equity.
“Most of these provisions that have been made are to enhance ongoing capital market reforms relating to securities lending transactions, real estate investment trusts, as well as the minimum taxation reductions that have been pioneered by the two previous Finance Bills.
“The fifth principle is Critical Public Financial Management and Reform.
“This reform was designed to strengthen the … FIRS tax administration and coordination role in relation to the collection of taxes, vis-a-vis
- “the responsibilities of relevant law enforcement agencies, such as the Nigerian Police or the EFCC [Economic and Financial Crimes Commission] and also
- “to ensure and reinforce the supremacy of the fiscal rules and regulations as provided for by the Finance Controls and Management Act, as well as the 1999 Constitution, as amended.”
