President Muhammadu Buhari on Monday signed the Finance Bill into law to support the implementation of the 2020 budget.
The law alongside the 2020 Budget is aimed at reforming Nigeria’s tax system to align with global best practices, support MSMEs through the Ease of Doing Business initiative.
It also hopes to raise government revenues, as well as incentivize investments in infrastructure and capital markets.
President Buhari, after signing the bill into law, said: “This is the first time, since the return of democracy in 1999, that a Federal Budget is being accompanied by passage of a Finance Bill specially designed to support its implementation and to create a truly enabling environment for business and investment by the private sector.”
He thanked the leadership and members of the Ninth National Assembly for the “hard work and support that have gone into the passage of the landmark Deep Offshore and Inland Basin PSC Amendment Bill, and the Finance Bill; both vital to the successful implementation of the 2020 Budget.”
Both chambers of the National Assembly passed the finance bill in November while the 2020 budget in December 2019.
The finance law seeks to amend six tax provisions and make them more responsive to tax reform policies.
Meanwhile, there is an increase in Value Added Tax on specific goods and services from 5 percent to 7.5 percent; the law also affects changes in the tax provision of the Customs and Excise Tariff Act to encourage local manufacturers.
Other Acts captured include; Petroleum Profit Tax Act, Company Income Tax Act, Personal Income Tax Act, Stamp Duties Tax Act, and Capital Gains Act.
After passing the finance bill, President of the Senate, Ahmed Lawan, asked agencies of the Federal Government saddled with the responsibility of generating revenues including the Federal Inland Revenue Service, the Nigerian National Petroleum Corporation (NNPC), and the Nigeria Customs Services among others, to be more efficient in discharging their duties.
Addressing his colleagues during plenary after they shared their various perspectives on the effects of the bill on the nation and its people, the Senate President explained that the bill aims to help Nigeria generate more revenues.