The Federal Executive Council (FEC) on Wednesday ratified the 2022 Finance Bill, clearing the way for the National Assembly to review tax policies, as well as amend some 11 fiscal laws, for the 2021/2022 fiscal year.
Minister of Finance, Budget and National Planning, Zainab Ahmed, gave the indications on Wednesday when she announced the ratification to State House Correspondents after the weekly FEC meeting presided over by President Muhammadu Buhari.
The Minister explained that the bill, which is currently before the National Assembly, focuses on closing loopholes and improving tax administration, rather than proposing new taxes, or increasing tax rates.
The draft bill was prepared by the Fiscal Policy Committee, with a focus on tax and reviewing some fiscal laws and also amending some and some laws, numbering about 11
The purpose, according to her, is to be able to refine the nation’s fiscal laws to improve tax compliance and also to enhance revenue generation.
“So, the proposed legislation falls under five broad categories. The first one, of course, is domestic revenue mobilisation and various measures are proposed in the bill to enhance revenue and these include; one limited, excellent exemption of case from shares disposals from capital gains tax to long term equity investments, out to a close in tax loopholes for companies that are transmitted from the previous federal public tax regime to the world corporate tax and have recovered tax regime that is provided under the new petrol industry act of 2021. Three, there are also provisions that have been made to prevent the abuse of Personal Income Tax released by individual taxpayers and allowances to evade taxation.
“This second broad category is Tax Administration Reforms and this includes provisions to support the FIRS ongoing reforms to fully automate and deploy technology to enhance collections and encourage taxpayer compliance and there are several measures in that category. But the third one is International Taxation Reforms.
“This provision empowers the FIRS to better assess non-resident companies to taxation by taxing profits derived from digital services rendered to Nigerian customers and it’s also designed to reduce the tax compliance burdens on non-resident taxpayers that are not required to register in Nigeria as companies.
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Another broad objective of the Bill is to enhance financial reform, including tax equity.
“Most of these provisions that have been made are to enhance ongoing capital market reforms relating to securities lending transactions, real estate investment trusts, as well as the minimum taxation reductions that have been pioneered by the two previous Finance Bills.
The Bill also deals with Critical Public Financial Management and Reform, designed to strengthen the FIRS tax administration and coordination role in relation to the collection of taxes, vis-a-vis the responsibilities of relevant law enforcement agencies, such as the Nigerian Police or the EFCC and also to ensure and reinforce the supremacy of the fiscal rules and regulations as provided for by the Finance Controls and Management Act, as well as the 1999 Constitution, as amended.
“Again, to emphasise also that we shied away from addressing any changes to the VAT regime or the current Stamp Duty regime because of the current ongoing litigations by some states in those two areas. So, nothing was proposed on this. When it becomes clearer, when the courts take decision on this matter or resolutions to the current challenge is attained,” she explained.
This is as the Council also approved the sum of N965.9 million for the purchase of 49 operational vehicles for us by the Nigerian Correctional Service (NCS).
According to the Minister of Interior, Ogbeni Aregbesola, the vehicles, which would be procured from local manufacturers, would complement the ones already in use by the Correctional Service.
“The Nigerian Correctional Service through the Ministry of Interior presented a memo to council and obtained approval to spend the sum of N965,902,524.58 to procure 49 operational and Green Maria vehicles.
“These 49 vehicles will complement the 513 operational and Green Maria vehicles already purchased between 2016 and 2020. This does not in any way mean that we have met the vehicle needs of the Nigerian Correctional Service but noting that since the advent of this administration, concerted effort and commitment is being made to ensure that the Correctional Service is provisioned with operational tools to meet its mandate of keeping the facilities safe as well as having the logistics to move inmates from the facilities to the over 5022 courts scattered all over Nigeria”, he said.
Also speaking, Special Adviser to the President on Media and Publicity, Femi Adesina, said the council approved the sum N145 million for the procurement of office accommodation for the Federal Character Commission in Bayelsa State at the sum of N145 million.
He also announced the approval of N136.2 million for the procurement of operational vehicles for the National Agency for the Control of AIDS (NACA).
Responding to questions on the incessant jailbreaks, Aregbesola said the recent incidents in some parts of the country will not be a solid reason for him to resign his position as Minister.
The Minister noted that the series of jailbreaks did not happen as a result of lack of preparedness, but situations that were occasioned by a series of factors, adding that the federal government is doing all that is necessary to make the facilities impregnable.
Aregbesola noted that a number of prison officials died defending the custodial centres, which he said is the highest form of honour for the country.
“Imo was in April this year. Kabba was in September. Abologo was in October and Jos was in November. Those captured the attacks. As painful as those attacks were, very painful, nobody will really want the end of justice to be so vulnerable.
“The custodial facilities are the final end of criminal justice administration. So, morally, the state owes itself the responsibility of safe custody that must not be violated
“ We must appreciate the enormity of any successful attack on custodial facilities, and I so do, but I want us to put these things in the context of our security situation.
He assured me that his Ministry will continue to work hard to 8mprove conditions in the Correctional Centers.
“When our best does not suffice, it’s no longer a question of your inability to make preparation or failure for preparation or preparedness. It’s just that at that instance, you just couldn’t hold the defence and several factors are responsible.