The Ministry of Finance on Tuesday said that the take-off date for the implementation of the newly signed Finance Law would be announced in due course.
The Minister of Finance, Budget and National Planning, Mrs Zainab Ahmed, said this in a statement issued by her Media Adviser, Yunusa Abdullahi.
Abdullahi in the statement said that a large sum of money realised from the increase in Value Added Tax would go to the States and the Local Governments Areas.
He described the 2020 Finance Act as one for the people, considering the expansion of VAT exemption list which includes basic food items.
Some of these items are cooking oil, culinary herbs, fish of all kinds, flour and starch, fruits, live or raw meat and poultry, milk, nuts, pulses, roots, salt, vegetables, and locally manufactured sanitary towels, tuition and services rendered by Microfinance Banks.
Ahmed commended the president for ensuring that the bill becomes law.
She said, “The strategic objectives in the finance bill recognises the crucial relationship between fiscal policy, the regulatory environment and the strong capital market we all seek to effect in Nigeria.
“We planned that going forward, the annual budget will always be accompanied by finance bills to enable the realisation of revenue projections.
“Future finance bills will therefore also provide us with additional opportunities to incrementally improve the fiscal policy and regulatory/legal environment in order to further strengthen our domestic capital market, and ultimately ensure sustained and inclusive growth and development.”
Highlighting the amendments, Ahmed noted that the Finance Act has offered incremental but necessary amendments to certain provisions of existing tax laws.
Some of them are the Companies Income Tax Act 2004; Personal Income Tax Act 2007;
Value Added Tax Act 2007; Petroleum Profits Tax Act; Stamp Duties Act, 2007; Customs and Excise Tariff Act, 2004; and Capital Gains Tax Act, 2007.
Some of the proposals contained in the finance bill include Amendment of excess dividend tax rules that result in double taxation and discourage investments; review of commencement and cessation business rules that also lead to double taxation; an incentive of two per cent bonus for early tax payment by medium-sized companies and one per cent for large companies.
Others are an increase in the VAT rate; moderation of inefficient and ineffective tax incentives; and closing loopholes in the existing tax laws that allow tax avoidance resulting in tax revenue leakages.