The Minister of Finance, Zainab Ahmed, has assured Nigerians that the incremental changes to Nigeria’s tax laws do not mean that there will be an increase in taxes.
She gave the assurance on Wednesday, while addressing State House correspondents after the council approved the Finance Bill 2020.
The minister explained that the bill will ensure improvements in tax laws while reducing some taxes for small and medium enterprises.
She told journalists that the 2019 Finance Bill actually reduced taxes from 30% to 20% for businesses with a turnover of between N25 million and N100 million.
“When we say incremental changes, its making improvements in the tax law. It doesn’t mean increasing taxes. So, what we are doing in the Finance Bill for 2020, has no increases. There will be no VAT increase, VAT remains at 7.2%,” Ahmed said.
“And I gave an example of the changes we are making in the tax law.. in the last Finance Bill 2019, we reduced from 30% to 20% for enterprises that have turnover of between 25million to 100 million and we also moved taxes from 30% to 0% for enterprises that have turnover of 25 million and below which means they pay no taxes.
“What we are doing in the Finance Bill 2020 is to further remove the education tax of 2% for that lower category of enterprises that have a turnover of 25 million and below.
“So, when we say incremental, we mean gradually making changes so, the changes could be up or down. But for now, with the economic slowdown, our assessment is that this is the time to cut down on taxes, to not increase taxes at all and also to not increase levies”.
Meanwhile, the 2020 Finance Bill will now be sent to parliament for assent.
Other memos approved at the FEC include a 216-page report from the Ministry of Works and Housing, detailing progress made in the government’s mass housing initiatives, reports from the ministers’ visits to their states to assess the damage done to their states after the #EndSARS protests and a clarification from the Minister of Health that the strange illnesses recorded in many parts of the country is still being investigated by the Nigeria Centre for Disease Control (NCDC).