The Centre for the Promotion of Private Enterprise (CPPE) has expressed serious concern about what it described the rushed passage of the 2022 Finance Bill by the National Assembly, noting that the process calls to question the representation role of the Assembly.
A statement signed by the Chief Executive Officer (CEO) of the private sector advocacy group, Dr. Muda Yusuf, noted there was practically no room for public hearing and engagement with stakeholders in the consideration of the bill, despite the profound implications of the bill for investment, citizens welfare and the Nigeria economy.
According to the group, it is curious and puzzling that the Senate gives just 24 hours’ notice for stakeholders to attend a public hearing on the bill, pointing out that the short notice expresses the lawmakers’ deliberate exclusion of stakeholders from this important legislative process.
Noting that the House of Representatives gives a more generous notice of about three weeks, the CPPE lamented that in a sudden and baffling twist of events, the House passed the bill before the date of the advertised public hearing which was 13th January 2023.
It further described the forwarding of the bill to the President for assent as hasty and incomprehensible.
The Centre stated that the bill effected wide ranging amendments to key legislations including the Companies Income Tax Act, Customs, Excise Tariff Act, Personal Income Tax Act, Petroleum Profits Tax Act, Stamp Duties Act, Value Added Tax Act, Capital Gains Tax Act, Corrupt Practices and Other Related Offences Act, and Public Procurement Act
The CPPE stated: “It is regrettable that National Assembly hurriedly passed the bill without the benefit of input from citizens whom they were elected to represent. This is a major letdown by the National Assembly in its representation role in our democracy.
“The action is not consistent with the ideals and principles of our democracy because sovereignty
belongs ultimately to the people. What the National Assembly has done is tantamount to disrespect, disregard and contempt of the Nigerian people and the business community”, it added.
The OPS advocacy group further stated that the Bill as passed contained the several major provisions such as Imposition of excise duties on all services with rates to be determined by a presidential order the imposition of 0.5% tax on all eligible imports from non-African countries to fund Nigeria obligations to international organizations as well as an increase in Tertiary Education Tax from 2.5% to 3% of company profit.
The Centre pointed out that all of these had far-reaching implications for investors and citizens as it will affect the cost of production; and the operating cost and would undermine investors’ confidence with the attendant inflationary implications and increasing corporate tax to almost 35% which is one of the highest globally.
It further clarified: “Currently, corporate tax is 30%; there is Tertiary Education Tax of 2.5%; NITDA Tax of 1%; NASENI Levy of 0.25%; Police Trust Fund Tax 0.005%.
“Meanwhile, the National Assembly has already passed a bill imposing 1% tax for NYSC fund [awaiting the assent of the president] and another 1% Tertiary Health Levy is being planned.
“In the meantime, investors are grappling with macroeconomic headwinds including depreciating exchange rate, illiquidity in the official forex window, spiking energy cost, weak purchasing power, rising interest rate and surging inflation”, the Centre added.
Similarly, it stated that companies currently pay multitude of taxes, fees, levies to state governments, local governments and regulatory agencies, stressing that this is not the way to promote economic recovery, job creation and poverty alleviation as 133 million citizens are in extreme poverty.
The Centre maintained that these measures would further impoverish the citizens as these additional taxes would be ultimately borne by them.
It, therefore, appealed to President Buhari not to leave a legacy of unbearable tax burden for investors in the Nigerian economy. The torrent of taxes, levies, fees is crippling business.
The Centre recommended that the President should withhold assent on the 2022 Finance Bill until the National Assembly properly engages stakeholders as required by legislative protocols.
