Tax expert urges NASS to okay February 1 as VAT approval date

0
5
NASS
NASS

A tax expert, Mrs Morenike Babington-Ashaye, on Thursday urged the National Assembly to make a pronouncement on the commencement date for the implementation of the Finance Act 2019 to make it authentic before Nigerians.

Babington-Ashaye, President of the International Centre for Tax Research and Development (ICTRD), a non-governmental organization, made the remark in a statement made available to News Agency of Nigeria (NAN) in Lagos.

According to Babington-Ashaye, the omission of the commencement provision and any other transitional provision is a technical issue that is fundamental to the implementation of the Finance Act 2019.

NAN reports that to the Finance Bill, 2019, was submitted to National Assembly by President Muhammadu Buhari alongside the 2020 Appropriation Bill, and signed into law by the president on Jan. 13, 2020.

It has the objectives of promoting fiscal equity by mitigating instances of regressive taxation and reforming domestic tax laws to align with global best practices as well as introducing tax incentives for investments in infrastructure and capital markets.

It also supports Micro, Small and Medium scale businesses in line with the administration’s Ease of Doing Business Reforms and raises revenues for Federal, State and Local Governments.

The new Act raises VAT from five per cent to 7.5 per cent and which the Federal Government will from Feb. 1 begin its implementation.

She said the Minister of Finance, Budget and Planning or any other regulatory body so permitted by the National Assembly must issue a Gazette announcing to the public when provisions of the Finance Act would commence.

The tax expert also noted that the Gazette must also make clear issues in the Finance Act where such clarity is missing.

Babington-Ashaye, therefore, implored the government to put a hold on the collection of the Value Added Tax (VAT).

She said, “Kindly put on hold your instruction to collect VAT at 7.5 per cent, effective Feb. 1, 2020.

“However, VAT at five per cent can be collected pending the National Assembly’s approval of the commencement date of the Finance Act 2019.

“The power to issue regulations must be derived from the Finance Act.”

Babington-Ashaye said without proper notification of the commencement of the Finance Act, the general public might refuse to comply with the new rate or any other provisions in the Finance Act 2019 and it might lead to court cases.

The former Executive Chairman, Ogun State Internal Revenue Service, also said that without the pronouncement on the commencement date, the law could not be alleged by the revenue agencies in court or tax tribunal.

The tax expert said such Act in developed climes such as the United Kingdom and even in African country such as Kenya had commencement dates.

She advised stakeholders to refer to the UK Finance Act 2019 and Kenya Finance Act 2019 on commencement and transitional provisions for the implementation of their Finance Act.

She said that it would help for the best interest of tax development in Nigeria. (NAN)

– Jan. 23, 2020 @ 19:05 GMT |

Click Banner for Details