In a bid to reducing the tax burden on ordinary Nigerians and increasing the ease of doing business, the Federal Executive Council (FEC) has approved two Executive Orders and five Amendment Bills to the country’s tax policies.
Disclosing this at a briefing with State House Correspondents at the end of the council’s meeting presided by President Muhammadu Buhari at the presidential villa in Abuja Wednesday, the Minister of Finance, Kemi Adeosun, said that the two approved Executive Orders are:
Value Added Tax Act (Modification) Order and Review of Goods Liable to Excise Duties and Applicable Rate Order while the five Amendment Bills include the Companies Income Tax Act (Amendment) Bill and Value Added Tax Act (Amendment) Bill.
Others are Customs, Excise, Tariff ETC (Consolidation) Act (Amendment) Bill; Personal Income Tax Act (Amendment) Bill and Industrial Development (Income Tax Relief) Act (Amendment) Bill.
The minister revealed that the approval followed the presentation of a memorandum to seek the consideration and approval of the Council for the report of the National Tax Policy Implementation Committee on Tax Laws Reform.
FEC had on February 1, 2017, approved the revised National Tax Policy in order to have a robust tax system that would promote investment and improve revenue for sustainable national development.
Mrs Adeosun maintained that the new tax policies would remove obsolete, ambiguous and contradictory provisions in the laws, increase government revenue and simplify the process of paying taxes and doing business.
“Majority of the provisions approved today are actually removing the tax burden and clarifying obsolete and ambiguous areas of tax. So for example for VAT there is to be exemption for residential property, leases on rental, transport for the general public and life insurance.
“These are areas that previously were VAT-able and what was approved today was that these areas should be removed, then, they shouldn’t be subject to VAT.
“In the short term of course that means a revenue loss for government. But we think in the long run that is the right thing to do is improving ease of doing business and reducing the tax burden on our people which is really one of the objectives of this government,’’ she explained.
She disclosed that the government was proposing an amendment to the Company Income Tax aimed at reducing the Right of Tax on Micro, Small and Medium Enterprises (SME) from 20 per cent to 15 per cent.