On Wednesday, the National Assembly passed the Finance Bill, a groundbreaking legislation that proposes key reforms to various taxation, customs, excise, and fiscal laws. This bill will amend several laws including the Capital Gains Tax Act, Companies Income Tax Act, Personal Income Tax Act, Petroleum Profits Tax Act, as well as the Stamp Duties Act, Value Added Tax, and Public Procurement Act.
In his report on the Finance Bill, Senator Solomon Adeola, Chairman of the Finance Committee, explained that the bill aims to promote tax equity by bringing more economic sectors into the tax net and ensuring a more equitable distribution of revenue receipts to all levels of government.
One significant change proposed in the Finance Bill is the renaming of the Federal Inland Revenue Service (FIRS) to the Nigeria Revenue Service. The board of this organization will be led by a separate chairman, while the management will be headed by a Chief Executive known as the Commissioner General.
In addition, the Finance Bill includes an increase in the rate of the tertiary education trust fund tax from 2.5% to 3%. Overall, this legislation is poised to bring about significant changes to the nation’s financial systems and contribute to the country’s overall development.
Importance of Finance Bill
The Finance Bill is an important piece of legislation in Nigeria because it proposes key reforms to various taxation, customs, excise, and fiscal laws. These reforms aim to enhance tax equity by bringing more economic sectors into the tax net and ensuring a fairer distribution of revenue receipts to all tiers of government. The bill also seeks to change the name of the Federal Inland Revenue Service (FIRS) to Nigeria Revenue Service and increase the rate of the tertiary education trust fund tax.
These changes have the potential to significantly impact the financial systems in Nigeria and contribute to the country’s overall development. The Finance Bill can also help to improve the efficiency and effectiveness of the nation’s tax collection systems, which can lead to increased government revenue and support for public services and infrastructure. Additionally, the proposed reforms may encourage compliance with tax laws and regulations, which can help to promote a fair and transparent business environment.