The 2021 finance bill seeking to reduce import levy on buses, tractors and other motor vehicles has passed first and second reading at the senate.
The proposed law passed first and second reading on Wednesday after the senators gave it a special consideration.
A letter by President Muhammadu Buhari asking the national assembly to pass the bill was only read on the floors of the house of representatives and senate on Tuesday.
Normally, when a bill is read for the first time, a day is fixed to debate the general principles of the legislation after which it will be passed for second reading.
But speaking at the senate on Wednesday, Yahaya Abdullahi, senate leader, said special consideration should be given to the bill because of its importance to the economy.
While leading his colleagues to debate the bill, Abdullahi said the legislation is seeking to “provide fiscal relief for taxpayers by reducing the applicable minimum tax rate for two consecutive years of assessment.”
The senate leader said the bill is also seeking to amend the procurement act to implement key procurement reforms previously proposed by the national assembly in 2019.
“The Capital Gains Tax Act is amended at section 36(2) of the CGTA to the extent that exemption on tax liability for compensation for loss of office which was hitherto limited to N10, 000.00 is now extended to N10, 000, 000.00,” he said.
“There is a new section 32 which provides that no tax shall apply to any trade or business transferred to a Nigerian company for the purposes of better organization of that trade or business.
“Section 4 of the Value Added Tax (VAT) act has been amended by increasing the value added tax payable by consumers from 5% to 7.5%. Section 19 increased the penalty payable by a taxable person for non-remittance within the specified period from 5% to 10%.
“Under section 28, the penalty for failure to give notice of change of address or permanent cessation of business was increased from N5,000 to N 50,000 in the first month and N25,000 in subsequent months.
“There is a new section 8 of the VAT Act to cater for the registration of a taxable person upon commencement of business.
“The penalty for failure to register has been increased from N10,000 to N50,000 in the first month and from N 5,000 to N 25, 000 in the subsequent months.”
The senate leader said the bill also seeks to boost small and medium scale enterprises by reducing tax burden on them.
However, Ike Ekweremadu, senator representing Enugu west, said the bill must not be hurried.
“It is important that we put it to a public test and see what the Nigerian people will say. We must ensure that the people of Nigeria are carried along,” he said.
The bill passed second reading after it was put to a voice vote by Senate President Ahmad Lawan.