The 2020 finance bill, seeking to reduce import levy on buses, tractors and other motor vehicles, passed the first and second reading at the Senate on Wednesday.
BizWatch Nigeria had reported that President Muhammadu Buhari had transmitted the Finance Bill 2020 to the National Assembly for consideration and passage into law.
The proposed law passed first and second reading on Wednesday after the bill received a special consideration from the senators.
The bill passed second reading after it was put to a voice vote by Senate President Ahmad Lawan.
When a bill is read for the first time a day is fixed to debate the general principles of the legislationafter which it will be passed for second reading.
Yahaya Abdullahi, a senate leader, at the senate on Wednesday, said that special consideration should be given to the bill because of its importance to the economy.
Abdullahi said the legislation is seeking to “provide fiscal relief for taxpayers by reducing the applicable minimum tax rate for two consecutive years of assessment.”
The Senate leader said the bill also seeks to amend the procurement act to implement key procurement reforms previously proposed by the national assembly in 2019.
“The Capital Gains Tax Act is amended at section 36(2) of the CGTA to the extent that exemption on tax liability for compensation for loss of office which was hitherto limited to ₦10, 000.00 is now extended to ₦10, 000, 000,” he said.
“There is a new section 32 which provides that no tax shall apply to any trade or business transferred to a Nigerian company for the purposes of better organization of that trade or business.
“Section 4 of the Value Added Tax (VAT) act has been amended by increasing the value-added tax payable by consumers from 5% to 7.5%. Section 19 increased the penalty payable by a taxable person for non-remittance within the specified period from 5% to 10%.
“Under section 28, the penalty for failure to give notice of change of address or permanent cessation of business was increased from ₦5,000 to ₦50,000 in the first month and ₦25,000 in subsequent months.
“There is a new section 8 of the VAT Act to cater for the registration of a taxable person upon commencement of business.
“The penalty for failure to register has been increased from ₦10,000 to ₦50,000 in the first month and from ₦5,000 to ₦25, 000 in the subsequent months.”
Abdullahi said the bill also seeks to boost small and medium scale enterprises by reducing the tax burden on them.
Ike Ekweremadu, senator representing Enugu west, said the bill must not be hurried.
“It is important that we put it to a public test and see what the Nigerian people will say. We must ensure that the people of Nigeria are carried along,” he said.
