Recession: FG proposes exemption of minimum wage earners from tax
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THE Federal Government of Nigeria has said that it is proposing the exemption of minimum wage earners from paying the personal income tax as a way of reducing the impact of the economic recession on Nigerians.
This was disclosed in a statement posted on the Twitter handle of the Nigerian Presidency on Monday.
“In order to reduce the impact of inflation on Nigerians, the Buhari administration, is, through the 2020 Finance Bill, proposing the exemption of minimum wage earners from Personal Income Tax,” the tweet read.
This means that everyone who earns N30,000 monthly would not pay the personal income taxes from their salary.
The ICIR had reported that Nigeria is officially in recession following data from the National Bureau of Statistics (NBS).
According to the NBS, Nigeria’s economic growth contracted by -3.62 percent in the third quarter of 2020 recording a second consecutive quarterly Gross Development Product, GDP decline since the recession of 2016. The cumulative GDP for the first nine months of 2020 stood at -2.48 percent.
Reacting to the economic recession, the Socio-Economic Rights and Accountability Project (SERAP) in an open letter to President Muhammadu Buhari demanded a cut in the cost of governance.
SERAP charged the government to implement bold transparency and accountability policy as a way of responding to the economic recession.
“This economic crisis provides an opportunity to prioritise access of poor and vulnerable Nigerians to basic socio-economic rights, and to genuinely re-commit to the fight against corruption. The country cannot afford to get back to business as usual,” the letter read in part.
Atiku Abubakar, a former vice president of Nigeria and candidate of the People’s Democratic Party (PDP) while commenting on the economic recession said the proposed 2021 budget is no longer sustainable.
Atiku added that Nigeria should not continue to spend ‘lavishly’ because the country is financially broke already.
“Firstly, the proposed 2021 budget presented to the National Assembly on Tuesday, October 8, 2020, is no longer tenable. Nigeria neither has the resources, nor the need to implement such a luxury heavy budget. The nation is broke, but not broken. However, if we continue to spend lavishly, even when we do not earn commensurately, we would go from being a broke nation to being a broken nation,” Atiku said this among other recommendations.