Home Latest News Crisis hits NASS panel on Finance as Reps Committee boycotts Scheduled Public...

Crisis hits NASS panel on Finance as Reps Committee boycotts Scheduled Public Hearing

Crisis hits NASS panel on Finance as Reps Committee boycotts Scheduled Public Hearing

ADEKUNLE ADESUJI, Abuja

The crisis is currently rocking National Assembly Committee on Finance as the House of Representatives Committee on Finance boycotted of scheduled public hearing Finance Bill.

The Hearing was supposed to be a joint hearing according to the program distributed during the public hearing on Tuesday.

But, the members of the Committee decided not to appear at the public hearing due to disagreement between both chambers .

A source closed to the Committee informed our correspondent that the reason behind the decision of House of Representatives Committee on Finance to boycotted from the public hearing us as result of lack proper consultation by the Senate Committee chaired by Senator Adeola Olamilekan.

The Source added that some of the Committee members in the House of Representatives got to known about the Public hearing in the advertisement placed in the National Newspapers.

Our correspondent observed that although the Photographs of Speaker of House of Representatives , Rt. Hon. Femi Gbajabiamila and the Chairman of House Committee on Finance, Hon. Biodun Faleke in the Committee.

Both Gbajabiamila and Faleke were absent at the public hearing. It was gathered that the Finance Committee has decided to hold its own public hearing separately.

Speaking at the public hearing, The Institute of Chartered Accountants of Nigeria (ICAN) applauded the renewed commitment to improve tax provisions and make them more responsive to the tax reform policies of the Federal Government.

The Chairman of ICAN, Mr. Nnamdi Okwuadigbo who gave the commendation said reforms in tax are critical to generating the required revenue to fund government budgets.

The public hearing which had participants from government and private sectors was organise by the Senate Committee on Finance.

President Muhammadu Buhari had presented Finance Bill 2019 alongside the 2020 Appropriation Bill for consideration of National Assembly.

The finance bill proposes to introduce tax reforms which will help government achieve its revenue projections for the 2020 budget.

Some of the proposals in the bill include an increase in Value Added Tax (VAT) rate, moderation of inefficient and ineffective tax incentive and closing loopholes in the existing tax laws that allows tax avoidance resulting in tax revenue leakages among others.

He said the importance of taxation lies in its ability to raise capital for development and growth of the economy.

This, he said, resulted in economic stabilization and effective redistribution of income.

On Companies Income Tax,(CIT), he said the intended amendments to various sections, between Sections 9 and 105 of the company income tax would generate more revenue for the government and support Small and Medium Scale Enterprises(SMEs) through applicable tax reductions.

According to him, encouraging SMEs will lift a large percentage of the Nigerian populace out of poverty.

He said the amendments would further improve the level of transparency and accountability amongst corporate entities, if implemented effectively.

He, however, said using rate of turnover only as a criterion for exempting a small firm from CIT should be reviewed.

“There are companies which are viable with turnover less than N25 million and could be brought to the tax net while a company may have a high turnover but less viable.

“Turnover should not be the only criterion for exemption.

“The tax rate for companies with turnover of over N100 million should be clearly stated.”

He said ICAN agrees with the provisions for insurance companies to carry tax losses indefinitely and the abolishment of special minimum tax for insurance companies, noting that the provision would increase the tax net.

He said linking Tax Identification Number (TIN) with the bank account was a welcome development, but however, noted that the informal sector of the economy which supports the main sector was usually left out of the tax net.

“The provision to create a nexus for taxation of services rendered offshore to ensure Nigeria earns its fair amount of revenue from such activities is commendable.

“The initiative will improve the revenue base of the government; nonetheless, clarity is needed in the percentage of tax to be repatriated to the country.”

On Value Added Tax(VAT),he said the substitution of the words “the Federal Board of inland Revenue” with “the Federal Inland Revenue Service“ in sections 2(2), 49(1), 86(2)(a) & (8), 102(1), 104(3)(c)(ii) and 108(f) of the Personal Income Tax Act. Cap. P8, Laws of the Federation of Nigeria 2004 as amended was long overdue.

He said VAT registration threshold would ensure that micro and small business, which are mostly informal and do not have the capacity to comply with VAT requirements, need not worry about VAT registration and filing.

” This will be a win-win situation considering that the cost expended in administering VAT to this segment of the economy outweighs the likely revenue to be realised.”

He said the proposal to increase penalty for non-compliance in tax payment was appropriate, adding that there should however be incentives for compliance such as tax rebate and tax holiday.

“To encourage compliance, the country’s tax system should be made more transparent and government at all levels should give appropriate account of the revenue from tax.”

On Custom and Excise Duties ,he said imposing custom and excise duty charges might lead to increase in the cost of locally manufactured goods and also make them to be less price competitive in the market.

On Stamp Duty,he said the implementation of stamp duty in Nigeria was not clearly defined nor understood by majority of the citizens.

” The stamp duty in Nigeria shows a high level multi-taxing process in its implementation.

” Although stamp duty policy will enhance revenue generation, however its impact on economic growth, fairness and equity is debatable.

Also speaking, representative of KPMG at the public hearing, Ajibola Olomola said, “The incentives provided for SMES appropriating considering the NBS estimate that they provide gainful employment opportunities for Nigerians. Giving them tax holiday will stimulate employment opportunities. The bill provides 0/5% for companies with no taxable assets. Reducing it to 0.2.5% will be good and moderate. ”

Also, Manufacturer Association of Nigeria (MAN) represented by Razaq Okukaja said, “MAN contributed 12 per cent of GDP, meaning manufacturing is playing a key role.

Our first proposal, Company income tax,

Less than N20 million micro businesses be exempted, less an increase in VAT levied on luxury goods, there is also need for moderation to attract investment

On stamp duty, the 50 stamp duty should be on transaction more than N1000, 000 and above.”

For a better society

Total Views: 147 ,

NO COMMENTS

Leave a Reply