Connect with us

Business & Economy

Senate passes finance bill two weeks after transmission

Published

on

Senate-President-Lawan
Senate President Ahmad Lawan
Share

…extends capital implementation of 2021 Appropriation Act till March next year 

The Senate on Tuesday passed the Finance Bill 2021, transmitted to the National Assembly by President Muhammadu Buhari, on December 7, 2021.

The passage of the bill two weeks later, followed the consideration of a report by the Joint Committee on Finance; Customs, Excise and Tariff; Trade and Investment.

Chairman of the Joint Committee, Senator Solomon Olamilekan Adeola, in his presentation, said the bill seeks to support the implementation of the 2022 Federal Budget of Economic Growth and Sustainability by proposing key specific taxation, customs, excise, fiscal and other relevant laws.

According to the lawmaker, a total of twelve Acts were amended under the finance bill which contains thirty-nine clauses.

He added that the bill seeks to promote fiscal equity, align domestic tax laws with global best practice, introduce tax incentives for infrastructure and capital markets, support small businesses and promote increase government revenue.

“The Finance Act 2020 was predicated essentially on having no new taxes and no new incentives due to the COVID -19’s impact on the economy as such it was structured across four broad thematic areas; Enacting counter cyclical measures and crisis intervention initiatives; Tax, fiscal responsibility, and public procurement reforms; Reforming fiscal incentives policies for job creation; Ensuring closer coordination of monetary, trade and fiscal policies; and Enhancing tax administration”, Senator Adeola said.

The Joint Committee, based on its observations, accordingly, recommended 5 percent Capital Gains Tax to be imposed on shares’ disposal transactions

where gains exceed N250m in 12 calendar months.

It recommended that Gaming and Lottery Companies be taxable, as well as Oil and Gas Companies.

It underscored the need for Midstream and Downstream Oil and Gas Companies to be made liable to corporate tax without the benefit of tax exemptions for firms exporting goods to earn foreign exchange.

The Committee observed that doing so would prevent Double-Dipping by Gas Utilization Companies such that they cannot claim both (1) 3-year Tax Holidays; as well as (2) Petroleum Profit Tax Act Incentives or (3) Pioneer tax Holidays under IDITRA.

The Joint Committee advocated for qualifying Capital Expenditure rules for small and pioneer Companies, to prevent double dipping by mandating that Companies cannot deduct qualifying Capital Expenditure to reduce their taxable profits where the relevant qualifying Capital Expenditure is used to generate tax – exempt income

It sought more powers for the Federal Inland Revenue Service (FIRS) to collect NPTF levies on Nigerian Companies on behalf of the fund and to streamline tax levy collection from Nigerian Companies in line with President Buhari administration’s ease of doing business reforms.

The Joint Committee also harped on the need for the Federal Government to ensure that FIRS deploys both proprietary and third-party tech applications to collect information from taxpayers, enhance confidentiality and non-disclosure and to enable them investigate tax evasion and other crimes and sanction non-compliant tax payers.

It further called for FIRS to be empowered to assess Non-Resident Firms to tax on fair and reasonable turnover basis on Turnover earned from digital services to Nigerian customers, with a further mandate to appoint persons for the purpose of collection and remittance of non- resident taxes.
The Committee demanded necessary reforms on securities lending transactions, minimum Tax for Insurance Companies and Companies in general, Taxation of Unit Trust Income, Real Estate Investment Trust, and Insurance Companies Capitalization by NAICOM in line with Tax Equity.

It urged the government to mandate FIRS as Principal Tax Revenue Collection Agency to collaborate with other law enforcement MDAs in streamlining Tax Collections by enhancing Public Financial Management reforms.

According to the Joint Committee, doing so would reduce revenue leakages and better track actual expenditure to revenue performance in line with the provision of the Constitution of the Federal Republic of Nigeria 1999 (as Amended), Fiscal Rules and other Extant Money Acts.

It also called for the diversification of Nigeria’s revenue from Oil sector to other sectors to fund critical expenditures.

The Committee while demanding an increase of 0.5 percent in educational tax, pushed for close monitoring of unfolding development and policies on VAT, Tax Incentives, Projected increase Tariff on Tobacco, Alcohol and Carbonated drinks to fund vital expenditure on Health, Education and Security, with a possibility of introduction of new taxes, tariffs and levies as the economy recovers.

Meanwhile, the Senate on Tuesday also passed a bill to amend the 2021 Appropriations Act.

The bill sponsored by the Senate Leader, Yahaya Abdullahi, scaled through second and third reading after it was considered during plenary.

The 2021 Appropriations Act (Amendment) bill seeks to extend the implementation of the Capital aspect of the Appropriation Act 2021 from December 31, 2021, to March 31, 2022.

Continue Reading
Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

Business & Economy

We Have No Magic Wand, Tackling Inflation Will Take Time — Cardoso

Published

on

Yemi Cardoso,CBN Governor
Yemi Cardoso,CBN Governor
Share

The Governor of Central Bank of Nigeria, Mr. Olayemi Cardoso has urged the citizens to be patient over the fight against current inflation and hike in food items in the country.

Cardoso disclosed this while briefing journalists at the end of the Monetary Policy Committee, MPC, meeting in Abuja.

The CBN governor mentioned that there was no magic needed to solve inflation in Nigeria but rather patience.

Also, Cardoso noted that despite pressure from food inflation, the general inflation rate was “moderating”, pointing out that “the tools the Central Bank is using are working”.

He stated, “I have several times and I will say again, there is no magic wand. These are things that need to take their time.

“I am pleased and confident that we are beginning to get some relief and in another couple of months we will see the more positive outcomes from the Central Bank have been doing.”

He added, “The committee thus reiterated several challenges confronting the effective moderation of food inflation to include rising costs of transportation of farm produce, infrastructure- related constraints along the line of distribution network, security challenges in some food producing areas, and exchange rate pass-through to domestic prices for imported food items.

“The MPC urged that more be done to address the security of farming communities to guarantee improved food production in these areas.

“Members further observed the recent volatility in the foreign exchange market, attributing this to seasonal demand, a reflection of the interplay between demand and supply in a freely functioning market system.”

The Central Bank of Nigeria has also blamed the recent volatility of the country’s foreign exchange market on seasonal demand for dollars.

“Members further observed the recent volatility in the foreign exchange market, attributing this to seasonal demand, a reflection of the interplay between demand and supply in a freely functioning market system,” a communique issued by the committee on Tuesday stated.

Continue Reading

Business & Economy

Port Harcourt Refinery Begins Full Operations Next Month

Published

on

Port Harcourt Refinery
Port Harcourt Refinery
Share

The 210,000-barrel-per-day Port Harcourt refinery is expected to commence operations by the end of July, following multiple delays.

National Public Relations Officer of the Independent Marketers Association of Nigeria, Chief Ukadike Chinedu, revealed this new timeline on Monday. He noted that the refinery’s operation would boost economic activities, reduce petroleum product prices, and ensure an adequate supply.

In December last year, Minister of State for Petroleum Resources, Heineken Lokpobiri, announced the mechanical completion and flare start-off of the Port Harcourt refinery, the largest in the region.

The refinery consists of two units: an older plant with a 60,000-barrel-per-day capacity and a newer plant with a 150,000-barrel-per-day capacity. The refinery was shut down in March 2019 for the first phase of repairs after the government enlisted Italy’s Maire Tecnimont as a technical adviser and appointed oil major Eni as a technical adviser.

On March 15, 2024, NNPC Limited’s Group Chief Executive Officer, Mele Kyari, announced that the Port Harcourt refinery would begin operations in about two weeks. He made this statement during a press briefing following his appearance before the Senate Ad hoc committee investigating the various turnaround maintenance projects of the country’s refineries.

“We achieved mechanical completion in December,” Kyari stated. “We now have crude oil stocked in the refinery and are conducting regulatory compliance tests. The Port Harcourt refinery will start within two weeks.”

However, two months later, the refinery had yet to commence operations.

In an interview, IPMAN’s Ukadike emphasized that the work done on the refinery represented a complete overhaul rather than mere rehabilitation. He assured that every effort was being made to meet the July deadline.

Ukadike said, “When we visited, the MD informed us that the refinery was nearly ready and would start production by the end of July. The overhaul is extensive, with all the armoured cables replaced and everything almost brand new. The maintenance turnaround is massive, with work being done day and night. All hands are on deck to meet the target. By the end of July, the refinery should be operational.”

When asked about the government’s previous unfulfilled promises to restart the refinery, Ukadike acknowledged the delays but noted that no reasons were given for missing the last deadline in April

Continue Reading

Business & Economy

CBN Halts 0.5% Cybersecurity Levy

Published

on

CBN Headquarters Abuja
CBN Headquarters Abuja
Share

The Central Bank of Nigeria (CBN) has withdrawn the circular directing banks to implement a 0.5 per cent cybersecurity levy on electronic transactions in the country.

The CBN announced this in a revised circular dated May 17, 2024.

The circular was addressed to commercial banks, Payment Service Providers (PSPs), non-interest, and merchant banks, among others.

It was signed by the CBN Director of Payment Systems Management, Chibuzor Efobi, and the Director of Financial Policy and Regulation Department, Haruna Mustafa.

The circular read: “The Central Bank of Nigeria circular dated May 6, 2024 (Ref: PSMD/DIR/PUB/LAB/017/004) on the above subject refers.

“Further to this, please be advised that the above-referenced circular is hereby withdrawn.”The withdrawal of the circular on the cybersecurity levy followed its suspension by President Bola Tinubu.

it would be recalls that Tinubu suspended the controversial cybersecurity levy on electronic transfers on May 14.

Minister of Information and National Orientation Mohammed Idris, who made this known while speaking to journalists after the Federal Executive Council (FEC) meeting at the Presidential Villa in Abuja, disclosed that Tinubu directed the CBN to suspend the implementation and review the modalities for the implementation of the levy.

Idris added that the levy was thoroughly discussed at the FEC meeting, saying the president was not oblivious to the feelings of Nigerians.

It would be recalled that CBN, in a circular dated May 6, directed banks to start charging a 0.5 per cent cybersecurity levy on all electronic transfers.

The apex bank stated that the deduction and collection of the cybersecurity levy is a sequel to the enactment of the Cybercrime (prohibition, prevention etc) Amendment Act of 2024.

This was greeted with wide condemnations by Nigerians, with many groups and individuals calling for the immediate reversal of the levy.

The House of Representatives also asked the CBN to withdraw the directive.

Continue Reading