The Nigerian Senate yesterday passed the Finance Bill 2021, which was forwarded to the National Assembly by President Muhammadu Buhari on December 7, 2021.
According to La Nation, the passage through the red chamber of the National Assembly, follows the examination of a report by the joint finance committee of the Senate; Customs, Excise and Tariff; Trade and investment.
One of the main highlights of the bill is the aspect giving the Federal Inland Revenues Service (FIRS) the power to assess non-resident businesses such as Twitter, Facebook, Google, and Netflix, among others.
They should be taxed on fair and reasonable revenue generated from digital services to Nigerian customers.
The Finance Bill further directs the FIRS to appoint persons to collect and remit taxes from non-residents.
In his presentation, joint committee chair Senator Solomon Adeola said the bill aims to support the implementation of the 2022 federal economic growth and sustainability budget by proposing key specific taxes, such as duties. customs, tax charges and other relevant laws.
Adeola, representing Lagos West, said a total of 12 laws were amended under the Finance Bill which contained 39 clauses.
He said the bill aims to promote tax fairness, align national tax laws with global best practices, introduce infrastructure and capital market tax incentives and support small businesses to grow. increase government revenue.
“The 2020 finance law was essentially based on the absence of new taxes and new incentives due to the impact of COVID -19 on the economy, as such it was structured in four main thematic areas; adopting counter-cyclical measures and crisis intervention initiatives; Reforms in taxation, fiscal responsibility and public procurement; Reforming the policies of tax incentives for job creation; ensuring closer coordination of monetary policies, trade and tax and improve tax administration,” said Adeola.
According to the committee, it has been recommended that a capital gains tax of five per cent be imposed on share disposal transactions where the gains exceed N250 million in 12 months.
He also recommended that gaming and lottery companies be taxed, as applied to oil and gas companies.
The bill emphasized the need for midstream and downstream oil and gas companies to be subject to corporation tax, without benefiting from tax exemptions for companies exporting goods to earn foreign exchange.
The bill also sought to give more powers to the Federal Inland Revenue Service (FIRS) to collect Nigeria Police Trust Fund (NPTF) levies on Nigerian companies and to streamline the collection of taxes and levies from Nigerian companies in accordance to the ease of the administration to make trade reforms.
The committee noted the need for the Nigerian government to ensure that the FIRS deploys proprietary and third-party technology applications to collect information from taxpayers, enhance confidentiality and non-disclosure and enable them to investigate the evasion tax and other crimes and to punish tax defaulters.
The Bill further empowers the FIRS to assess and tax non-resident businesses on the basis of a fair and reasonable turnover on revenue derived from digital services to Nigerian customers, with an additional mandate to appoint persons for the purpose of collecting and remitting taxes from non-residents.