CITN: National Tax Policy will fix tax hitches

Please follow and like us:

  • 0
  • Share

President, Chartered Institute of Taxation of Nigeria (CITN), Teju Somorin, has said the National Tax Policy, approved by the Federal Executive Council (FEC) will address challenges facing the tax system.
Speaking during the 36th induction ceremony of the Institute in Lagos at the weekend, she described the tax policy document as a slim, simple and concise revised policy with clear implementation and monitoring strategies for stakeholders in the Nigeria tax system.
She said the new document has defined “tax” as “any compulsory payment to government, imposed by law without direct benefit or return of value or a service whether it is called a tax or not.”
Somorin said the policy has become necessary at this stage of Nigeria’s economic development and is consistent with the shift from direct to indirect taxes enshrined in the National Tax Policy.
She said the 2017 budget did not propose increase in taxes but provides for expansion of tax horizon so that more people will start paying tax. The budget, she further noted, did not recommend increase in value added tax (VAT) but increase in VAT payable on luxury goods such as Champaigne among others.
She recommended that since small and medium scale businesses are the engine of growth of every economy, especially in Nigeria where over 90 per cent of employers of labour, fall within this category, the qualification for the lower income tax rate applicable to small businesses should be reviewed in line with current economic realities.
“The income tax rate for small businesses should be further reduced as an incentive to encourage compliance and promote Micro, Small and Medium Enterprises (MSMEs)”, she stated.
She further recommended that a minimum threshold for VAT registration and compliance should be put in place in order to protect micro-businesses.
She said the National Economic Council has approved the implementation of the Voluntary Asset and Income Declaration Scheme (VAIDS) aimed at addressing high rate of tax evasion in the country.
“The VAIDS, which is likely to become operational next month, is hoped to boost the revenue portfolios of the Federal and State Governments. Indeed, FIRS is targeting an increase in tax contribution to the Gross Domestic Products to 18 per cent by 2020. The scheme will offer a window for those who have not complied with the extant tax regulations to remedy their positions by the provision of limited amnesty to promt voluntary declaration and payment of liabilities.
The scheme will also have incentives in place to encourage early participation. For example, taxpayers will be allowed up to three years to settle their tax liabilities,” she said.
She said the Stamp Duties Act (Amendment) Bill, 2017 is currently before the House of Representatives, undergoing legislative process.
“It seeks to expand the scope of the Stamp Duties Act and address the current ambiguities in the law. The Bill will also legalise the controversial imposition of stamp duty on bank deposits while the definition of a “stamp” has been expanded to include electronic, internet and Point of Sale (POS) transactions. Other proposed changes include: Substantial increase in penalties, compulsory use of postage stamp instead of adhesive stamp and Imposition of stamp duty on all forms of agreements. Government Integrated Financial Information System (GIFMIS),” she said.

The post CITN: National Tax Policy will fix tax hitches appeared first on The Nation Nigeria.

Facebook Comments

Please follow and like us:

  • 0
  • Share

Leave a Reply

Your email address will not be published. Required fields are marked *