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Promoting Good Governance.

Buhari signs Finance Bill into law

Nigerian President, Muhammadu Buhari has on Monday signed into law the 2019 Finance Bill earlier presented to the National Assembly alongside the 2020 Budget.

According to Buhari, the bill is targeted at generating revenue into the treasury of Nigeria as well as reforming the nation’s tax law to align with ‘global best practice’.

Buhari added that the purpose of the bill is to support Micro, Small and Medium Enterprises (MSMEs) in line with Ease of Doing Business Reforms initiative of his administration and creating incentives for investments in infrastructure and capital markets.

The 2019 Finance Bill indicates that there will be an increase in Value Added Tax (VAT) from 5 percent to 7.5 percent.

Although there were critical responses to the VAT part of the bill, it scaled through all readings by the Senate before the president signed it into law.

The newly passed law also stated that companies operating from outside of the country will be taxed for operating in Nigeria not exempting those that engage in the digital economy with ‘significant economic presence’.

Personal Income Tax Act was also amended; the amendment specifies that banks are to demand Tax Identification Number (TIN) from their customers before opening a new bank account and from its existing customers.

Companies operating in Nigeria would also be subjected to having a TIN, if not they would be unable to operate a corporate an account with banks in Nigeria.

 

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