The Federal Government has suggested additional taxes, tariffs, and levies to be introduced in 2022 in order to boost revenue.
Zainab Ahmed, Minister of Finance, Budget, and National Planning, made the remarks on Monday during a public hearing on the 2021 Finance Bill organized by the House of Representatives Committee on Finance in Abuja on Monday.
According to her, Nigeria must diversify its revenues from oil to cover key expenditures.
In the note she delivered to the committee, the Minister explained that as of September, the Federal Government’s retained revenue was N4.56 trillion, or 75% of the budget, while the government’s share of oil revenues was N845 billion, or 56.3 percent pro-rated performance, and non-oil revenue share was N1.31 trillion, or 117.3 percent above budget.
She added that Companies Income Tax and Value Added Tax collections were N616bn and N274.4bn, representing 121 per cent and 153 per cent respectively of the pro-rata targets, while Customs collections were N418.97bn.
“This is clearly, our ongoing fiscal reforms of the last six years are yielding tangible results. However, the FMFBNP is closely studying the following issues, developments and policies:
“Current fiscal policy stance to let tax incentives with sunset provisions to naturally expire and not to automatically renew such incentives without a detailed tax expenditure cost /benefit evaluation of the relative success of the incentives before extending incentives further;
“Acceleration of projected increase tariff and excise duties (so-called ‘sin classes’) on tobacco, alcohol and carbonated drinks to fund vital expenditure on health, education and security;
“Wholesale reform of antiquated stamp duties and capital gains tax regime;
“Possibility of introduction of new taxes, tariffs and levies, as the economy recovers.”
The Minister also reiterated that with subsidy removal Nigeria can rechannel its scare resources to the development of the country.
Court cases hindering implementation of new tax
During the public hearing on the 2021 Finance Bill at the House of Representatives, organised by the Committee on Finance on Monday in Abuja, Zainab said FG had reformed some taxes, however, some lawsuits were delaying some.
She stated that Value Added Tax (VAT) and Stamp Duties on certain areas are some of the levies being contested in court, hence, the delay to their implementation.
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