The Finance Act 2019 (a landmark legislation issued 20 years after the Finance (Miscellaneous Taxation Provisions) Decree/ Act in 1999) made sweeping changes to Seven of Nigeria’s most significant tax laws. And true to the promise made by the President Buhari administration – to issue a Finance Act annually to accompany the nation’s budget, the draft of the 2020 Finance Bill is already drawn up and currently at its exposure phase with stakeholders.
According to President Buhari, in his 2021 budget presentation speech to the Parliament, the Finance Bill 2020 is to support the realisation of Nigeria’s 2021 revenue projections, adopt appropriate counter-cyclical fiscal policies and enhance the efficiency of fiscal incentives.
In the full week of 9 November 2020 to 13 November 2020, there were continuous focused stakeholder engagements by the Fiscal Reforms Committee – the Federal Government constituted committee tasked with development of Nigeria’s annual Finance Bills. This culminated in a public stakeholder consultation / engagement webinar on Friday, 13 November 2020, hosted by the Minister for Finance in support of the Fiscal Reforms Committee.
All interested stakeholders in the Nigerian tax system are by this engagement, being called upon to make suggestions as to tax law reforms or additions to be considered for inclusion in the Finance Bill 2020.
The Finance Bill 2020 is staged across five (5) broad thematic areas as follows:
- Enacting counter cyclical measures and crisis intervention initiatives – this includes creating a legal framework for the creation of a crisis intervention fund; and introducing provisions to allow for the recovery of donations made towards the pandemic and other potential crises.
- Fiscal Relief for Mass Transit – this includes providing fiscal support for mass transit by reviewing the Duties Regime for the transportation sector (targeting motor vehicles, buses and trucks).
- Procurement Reforms – amending the Public Procurement Act to implement key procurement reforms.
- Tax & Fiscal Responsibility – amending key tax legislations to implement tax reforms; amending aspects of the Fiscal Responsibility Act 2007; and amending financial reporting and other fiscal rules for companies operating in the free trade zone.
- Ease of doing business (EODB) reforms – includes institutionalising EODB Reforms for Posterity; Introducing provisions in the tax laws that will ease tax compliance in Nigeria.
All stakeholders who wish to make recommendations for inclusion in the Finance Bill 2020 are called upon to submit such views, comments and suggestions to the Committee through the email address – email@example.com, on or before Monday, 16 November 2020.
All stakeholder views will be collated, reviewed and updated accordingly in the draft bill (click to view first draft). The Bill would be submitted to the Federal Executive Council for approval and then handed over to the President for presentation to the Parliament.