The Senate on Thursday passed the Finance Bill made up of 56 amendments from 7 different Acts.
This was disclosed by Sen. Solomon Adeola, Chairman Senate Committee on Finance, who addressed a news conference at the end of plenary.
He identified the amended Acts as: Companies Income Tax Act, Value Added Tax, VAT, Act, the Petroleum Profit Tax Act, PPTA, Personal Income Tax Act, Capital Gains Tax Act, CGTA, Customs and Excise Duty, and Stamp Duty.
Ademola disclosed that 26 amendments were sought from Company Income Tax, eight from Personal Income Tax, and 14 amendments from Stamp Duty.
From Value Added Tax, he said four amendments were sought, while one amendment each was sought from Custom and Excise Duty, and Petroleum Profit Tax.
The Finance Committee Chairman emphasised that the Finance Bill passed was not only about VAT, but was also aimed at creating an enabling business environment to alleviate tax burden for small and medium enterprises.
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His words: “Yes, VAT has become a major concern because of the increment sought for from 5 to 7.5 per cent, but also included in this Finance Bill, we now have a bill for some small companies whose revenues are less than N25 million to be exempted from VAT and tax payment.
“We went further that a medium scale company with revenue less than N100 million should have a reduction in its company’s income tax from 80 to 20 per cent.
“With this single action of passing this bill, the capital market has been reactivated and shares can be used to borrow money; dividends paid on the shares can be used as interest on the money borrowed.”
He assured that the increased VAT was not a random act but a well thought out process with comparison from other countries.
He pointed out that 85 per cent of the VAT goes to the Local and State Governments, with only 15 per cent for the Federal Government.
“We are not after putting any untold hardship on the common man; a lot of goods that VAT should be charged on have been exempted because of the less privileged.
“If you decide to eat in a hotel or restaurant rather than cook at home, then VAT is charged because that is luxury,” he said.
