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BUHARI SIGNS FINANCE BILL INTO LAW

President Muhammadu Buhari

The President of Nigeria, Muhammadu Buhari, on Monday, 13th January, 2020 signed the Finance Bill into law making it the first federal law enacted for the year 2020 after the term-limited Appropriation Act for 2020 was signed in the twilight of 2019. About 25 laws was signed into law by the President in 2019.

The signing was announced via the official Twitter Handle of the President @MBuhari.

The Finance Bill, it would be remembered, was introduced into the National Assembly as an Executive Bill. It seeks among others to amend a slew of Tax legislations, remove seeming contradictions and introduce greater simplification principles into Nigeria’s tax regime. The Bill had been notably promoted by the Federal Ministry of Finance and had secured the approval of Nigeria’s double chambered federal legislature regardless of some concerns stakeholders raised regarding some of the changes it introduced.

Notably, the bill had sought to change Nigeria’s VAT regime by increasing its current rate of 5% to 7.5% – a device the Federal Government hopes would help enlarge its revenue which critics argue could lead to inflation (if increase is passed on to consumers) or reduced investment as squeeze on profit de-incentivizes new capital inflow.

According to the presidential notice, the Finance Act was developed 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 President also touted the development as the “first time, since the return of democracy in 1999, that a Federal Budget is being accompanied by 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.”

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