UPDATE: Buhari Signs Finance Bill, 2020 Budget Into Law
President Muhammadu Buhari has signed the 2019 finance bill and the 2020 appropriation bill into law.
In a threaded tweet via @MBuhari, President Buhari posted thus:
“I am pleased to announce that this morning I signed into Law the Finance Bill, 2019.
“We introduced the Bill alongside the 2020 Budget, to:
-Reform Nigeria’s tax laws to align with global best practices;
-Support MSMEs in line with our Ease of Doing Business Reforms;
-Incentivize investments in infrastructure and capital markets;
-Raise Government revenues.
“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.
“I thank 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.”
The finance bill and the 2020 Budget, which are designed to reform Nigeria’s tax system, are expected to incentivize investments in infrastructure and capital markets.
They are also designed to raise government revenues and support MSMEs through the Ease of Doing Business initiative inline with global best practices.
According to the new finance law, six tax provisions will make it more responsive to tax reform policies.
For example, companies with less than N25 million revenue are exempted from taxes, companies with between N25 million and N100 million revenue will pay 20 per cent, while companies with over N100 million revenue will pay 30 per cent in come revenue tax.
STATE HOUSE PRESS RELEASE
PRESIDENT BUHARI SIGNS 2020 FINANCE BILL INTO LAW
President Muhammadu Buhari Monday in State House signed the 2020 Finance Bill into law. This is sequel to its passage by the National Assembly and subsequent forwarding by the legislature to the President for assent.
Recall that President Buhari, while presenting the 2020 Appropriation Bill to the National Assembly, had also presented the Finance Bill and said: “This Finance Bill has five strategic objectives, in terms of achieving incremental, but necessary, changes to our fiscal laws.
“These objectives are; Promoting fiscal equity by mitigating instances of regressive taxation; Reforming domestic tax laws to align with global best practices; Introducing tax incentives for investments in infrastructure and capital markets; Supporting Micro, Small and Medium-sized businesses in line with our Ease of Doing Business Reforms; and Raising Revenues for Government.
“The draft Finance Bill proposes an increase of the VAT rate from five per cent to 7.5 per cent , as such, the 2020 Appropriation Bill is based on this new VAT rate,” he added.
With the assent, there will be more revenue to finance key government projects especially in the areas of health, education and critical infrastructure.
Special Adviser to the President
(Media & Publicity)
January, 13, 2020
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.
Both chambers of the National Assembly have since passed both the finance bill and the 2020 budget into law.