The Nigerian President ratified the Nigerian Tax and Fiscal Law (Amendment) Bill 2019, or Finance Bill, after it was adopted by the National Assembly on 8 October 2019, simultaneously with the 2020 Budget. The bill aims to amend certain aspects of the tax system in order to increase government revenue, improve the business environment and diversify the economy to reduce dependence on crude oil sales. One of the key measures involves an increase in VAT from 5 per cent to 7.5 per cent, with the exemption of certain basic products.
The main aim of the bill is to increase government revenue through an increase in the value added tax (VAT) rate while supporting small businesses. In addition, the bill, which was passed by Parliament last year along with the record budget of 10.59 trillion naira ($34.6 billion) for 2020, aims to help the Nigerian economy emerge from its weak growth after the recession four years ago. The government hopes the new bill will help reform its domestic tax laws and provide incentives for investment in infrastructure and capital markets while supporting small businesses.
In total, more than 90 amendments to the Nigerian Tax and Fiscal Law are planned, with effective implementation of the VAT increase from 1 February 2020.
Sana Ghabri - Business France
Sources
• Actualités économiques d’Afrique de l’Ouest Nigéria - Ghana semaine 3 du 13 au 19 janvier 2020, Ministère de l’Économie et des Finances - French Republic, DG Trésor, 17 January 2020
• Actualités économiques d’Afrique de l’Ouest Nigéria - Ghana, Directorate General of the Treasury - Economic Services Publication, Week 3, from 13 to 19 January 2020
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