The Minister of Finance, Budget and National Planning, Zainab Ahmed, has said that the Finance Bill 2020 would not introduce new taxes or grant new tax waivers due to challenges posed by COVID-19.
The Executive Secretary, Federal Inland Revenue Service (FIRS), Mr Muhammad Nami, said this on behalf of Zainab Ahmed at a virtual meeting on the Finance Bill 2020 Public Consultation in Abuja on Friday.
The meeting was chaired by Mrs Zainab Ahmed.
According to Nami, the policy objective of the bill has no intension to introduce new taxes or grant waivers in view of the peculiarities of what is facing the economy.
“The economy is not doing very great because of the impact of COVID-19’and all other challenges so ordinarily government should be spending more money.
“However, the government is no ability to raise the taxes; in the same way, we still balance the budget to reduce the deficit as much as possible. Therefore, there will be no new waivers.”
Speaking on the African Continental Free Trade Area (AfCFTA) agreement, Nami said the impact would not be significant; in terms of revenue to government but increase the volume of trade with other countries.
“However, in anticipation of the AFCFTA, it is expected that the volume of trade will surge.
“And, as such, even though it will not significantly affect revenue being collected currently by government, it will have a way of making the economy increase significantly.”
Speaking, Zainab Ahmed said the public consultation was an opportunity to engage the public and get contributions to the draft of the Finance Bill 2020 aimed to support the 2021 Budget and also businesses.
The minister recalled that during the preparation of the Finance Bill 2019, provision for tax relief was made to small businesses.
“The essence was to ensure that local industries grow; because once the African Continental Free Trade Area (AfCFTA) takes effect; our borders will be opened; and we will have goods from other countries competing with goods in Nigeria.”
She said that one of the bases for reducing taxes was to help the small businesses grow; and to protect local industries.
“This is being reinforced in the 2021 proposal; by removing completely for the small businesses the obligation to pay education tax.”
She said that the draft Bill would go to the Federal Executive Council (FEC) for approval; after which the President would submit it to the National Assembly for consideration.