President Muhammadu Buhari, on Monday, signed the Finance Bill, which, among others, seeks to increase the value-added tax (VAT) from five per cent to 7.5 per cent.
The president announced this move on his verified Twitter account today.
He said “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 and raise government revenues.” the tweet reads.
This is the first time since the return of democracy in 1999, that a federal budget is being accompanied by the 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.
The bill will also reform the tax regime by amending several Acts, namely Petroleum Profit Tax Act (PPT), Custom and Excise Tax Act, Company Income Tax Act (CITA), Personal Income Tax Act, Value Added Tax Act, Stamp Duties Tax Act, and Capital Gains Act.
A statement was also released by Mr Buhari’s spokesperson, Femi Adesina, confirming the signing of the bill.
See the statement below.
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.
Femi Adesina
Special Adviser to the President
(Media & Publicity)