Senate passes finance bill to raise VAT from 5% to 7.5%
Amidst calls for caution, dispassionate assessment of the finance bill and the reservation expressed by senators on the possible implication of the tax component of the bill, the Senate, on Thursday, hurriedly passed the seven-component-executive financce bill aimed at raising revenue to fund 2020 budget projection through third reading.
The bill comprised seven Acts which include: Company Income Tax Act (CITA), Personal Income Tax (PITA), Value Added Tax Act (VATA) and Petroleum Profit Tax Act (PPTA).
Others are Stamps Duties Act (SDA), Customs and Excise Tariff Act (CETA) and Capital Gains Tax Act (CGTA).
The financial bill has 56 amendments passed in the committee of supply where the Senate Minority Leader, Eyinnaya Abaribe belatedly opposed the tax bill after he had voted its clauses.
President of the Senate, Ahmad Lawan, reminded the senator that the committee of supply had gone passed that clause to which, he Abaribe voted.
Senator Ifeanyi Ubah Anambra Central (YPP), said there was lack of stakeholders’ representation on the bill at the public hearing, while Senator Gabriel Suswam Benue North East (PDP) said the bill would deliver shocks to the people, and asked the Federal Government to provide a social safety net for the masses.
It would be recalled that Senators Yaroe Binus (Adamawa South) and Betty Apiafi (Rivers West) separately raised points of order drawing the attention of the senate president at plenary on November 6, 2019, to the non-circulation of the bill among senators to enable them to look through its details and make informed contributions ahead of its second reading.
The president of the Senate ruled both of them out of order and maintained that the details of the bill will only be made available at the committee level to senators.
Leader of the Senate, Senator Abdullahi Yahaya, in his lead remarks at plenary before the Senate dissolved into the committee of supply to pass the 56 clauses of the financial bill, called on his colleagues to look at the finance bill 2019 seeking to raise the revenue accruable to the Federal Government through increased tax regime from 5 per cent to 7.5 percent dispassionately.
He argued that the Nigerian economy has suffered a serious setback due to lack of revenue to fund the budget.
He maintained that the Nigerian economy is a very huge economy, and considered it irreconcilable that it can hardly raise N8 trillion to fund the budget.
Senator Yahaya said the bill should be viewed as a revenue-generating tool for the better economy than from partisan view.
His words: “The issue of the economy is an issue beyond politics. Whether it is APC today or PDP tomorrow, we have to come out and think of how to improve it.
“The major problem of the Nigerian economy is revenue. This is an N140 trillion economy, but hardly raises N8 trillion of revenue from the economy.”
He said this lack of revenue has been major reason governments in the past and present have challenges in delivering in the needed infrastructure to support and sustain the economy.
He maintained that while he remains a member of the All Progressives Congress, it was important to critically look at the amendment and tweak them to serve the interests of Nigerians.
Abdullahi’s belief that revenue was a major challenge to the nation was debunked by Senator Abba Moro, who said the challenge with revenue in the country was poor management and not the lack of it.