The Organised Private Sector on Monday warned the government against fleecing the people and endangering productivity.
They spoke in response to the signing of the Finance Bill into law by the President Muhammadu Buhari in Abuja.
The law heralds a new regime of Value Added Tax rate of 7.5 per cent, up from five per cent.
The Nigeria Employers’ Consultative Association warned the government against seeing the private sector as a cash cow in its drive to increase revenue.
On the other hand, the Lagos Chamber of Commerce and Industry expressed worry over the increase in VAT; even it said that it was inappropriate to compel loss-making firms to pay tax, no matter how little.
The Director General, NECA, Dr Timothy Olawale, noted that overburdening the private sector with taxes would further impoverish the citizens Buhari promised to take out of poverty.
He said, “The government should not see the private sector as a ‘cash cow’ in its drive to raise revenue, as it will do more harm to the already burdened private sector and further impoverish citizens that the president promised to take out of poverty.
“The common man will definitely be at the receiving end of the increase in VAT. Even if businesses are taxed more through likely illegal levies and rates outside the provisions of the law, they will naturally pass the cost to the customers whose purchasing power is already at the lowest ebb.
“The government should put mechanisms in place to eliminate leakages as a large chunk of the Internally Generated Revenue realised does not find its way into government coffers.
“They should drastically cut the cost of governance. Several aides kept at prohibitive cost are needless.”
He acknowledged that the government had made provisions in the law that were meant to benefit the masses while reforming the local tax laws in line with global best practices.
The new law amended the Petroleum Profit Tax Act, Customs and Excise Tariff Act, Company Income Tax Act, Personal Income Tax Act, Value Added Tax, Stamp Duties Act and the Capital Gains Tax.
Olawale said, “Apart from the increase in VAT, some other changes would include a situation where Nigerians who want to open or maintain accounts with the deposit money banks will not have to provide their Tax Identification Number to do so, which is commendable.
“Again, the fact that the Federal Government has raised the threshold from which stamp duty will be charged for online transactions from the current N1, 000 to N10,000.”
He recommended aggressive taxpayer enlightenment and expansion of the tax net to capture more citizens as it had been reported that less than 40 per cent of Nigerians were tax compliant.
Director General of the LCCI, Dr Muda Yusuf, said, “The increase in VAT from five per cent to 7.5 per cent amounts to additional burden on investors.
“Already businesses have been grappling with multiple taxation, high import duty, high regulatory charges, exclusion from the official forex market and high energy cost.
“It is also disturbing that in Nigeria, VAT is not treated as consumption tax. Most often it is imposed on the entire value chain of production and investment. This is why investors will worry about the review.”
The LCCI boss urged the government to scale up its commitment to the creation an enabling environment for investment, adding “this should be from the perspective of policy, regulatory and macroeconomic environment.”
Buhari had announced the signing of the bill through his verified personal twitter handle, @MBuhari.
“I am pleased to announce that this morning, I signed into the law the Finance Bill, 2019,” he tweeted.
The finance bill provides several revenue windows for the Federal Government to source funds, especially for the immediate financing of the 2020 budget.
The country’s budget for the year is N10.59tn, with a huge deficit of over N2tn.
…And the Winner of Best Mobile Banking App Award is FirstBank
First Bank of Nigeria Limited has been named 2019 “Best Mobile Banking App” and “Fastest Growing Retail Bank” by Global Business Outlook.
The Global Business Outlook Award recognises and rewards excellence in business in companies across the world, both in the public and private sectors. The award rewards innovation, creativity and the drive to create value.
FirstBank earned the Fastest Growing Retail Bank recognition because of its leading role in promoting financial inclusion in the country, a drive which has resulted in its 44,000 Agent Banking network designed to complement the provision of bespoke financial services at its over 750 branches nationwide.
Speaking on the awards, Folake Ani-Mumuney, the Bank’s Group Head, Marketing & Corporate Communications said, “We appreciate the recognition of these awards by the respective awarding bodies. The awards are dedicated to all our customers across the globe as their continued patronage of our services is appreciated.
We remain steadfast and would not rest on our laurels at rendering bespoke financial services tailored to meet the financial needs of our valued customers, irrespective of where they may be.”
FirstBank Boosts Education Sector, Supports Schools with N10bn Loan
Nigeria’s premier and leading financial services provider, First Bank of Nigeria Limited, has announced that within the last year, it has supported educational institutions in the country with loans to the tune of over N10 billion.
The Bank’s support is carried out through its FirstEdu product, an educational solution created to enhance the educational facilities in schools with a view to improving the quality of education across the country.
FirstEdu loan is targeted at private Nursery, Primary and Secondary schools to assist the schools in achieving their desired growth in the medium and long-term. The product provides funding to replace old furniture and equipment, pay staff salaries, purchase brand new or fairly-used buses as well as refurbish dilapidated buildings and classroom blocks. With this product, school owners/proprietors can stay ahead to make learning easy and conducive for students.
The product enables the schools to access facilities with no tangible collateral, apart from domiciliation of school fees account with the Bank.
On the other hand, FirstEdu portal is a modular and robust web-based enterprise portal that enables tertiary educational institutions manage academic, administrative, professional, logistics and payment challenges.
The product features and benefits include; e-Learning, virtual library and facilitation of exchange programmes with foreign educational institutions; academic & student events/time-table/calendar management; school fees payment via the internet; online information and result checking; interactive community forum between students and teachers. It also affords applicants the opportunity of enrolling from the comfort of their homes or any location around the world; no licensing, installation and maintenance cost and plugs avenues for revenue leakages amongst others.
According to Chuma Ezirim, Group Executive, e-Business & Retail Products, First Bank of Nigeria Limited, “With FirstEdu, private schools across the various tiers of education in Nigeria; elementary, secondary and tertiary, have the right tool to boost their business to the level they desire. We are pleased to have already disbursed over N10 billion loans to schools in one year and we would continue to support growth in this key sector of our economy.”
“At FirstBank, we identify with the impact of the educational sector on the socio-economic activities of the country and importantly the lives of everyone. We remain committed to supporting schools as education is the core and root factor at enabling growth of our economy” he concluded.
In need of the right educational solutions to give your school a boost, visit the FirstBank branch nearest to you or contact us on our social media channels; @firstbanknigeria on Instagram; @firstbankngr on twitter and FirstBankofNigeriaLimited on Facebook.
ECO Crisis: Nigeria, Other Countries Demand ECOWAS Meeting
Nigeria and six other members of the Economic Community of West African States (ECOWAS) on Thursday demanded a crucial extraordinary meeting to discuss the controversial renaming of the CFA Franc as ECO by eight of their counterparts.
The demand was contained in a communique issued at the end of a meeting by the countries, namely Nigeria, The Gambia, Ghana, Guinea, Liberia and Sierra Leone.
On December 21, 2019, the eight French-speaking West African countries announced their decision to dump the French CFA Franc for the ECO single currency scheduled to take off this year.
ECO is the name adopted for the common currency of the ECOWAS by the Authority of the Community’s Heads of State and Government at their 55th Ordinary Session in Abuja.
The announcement was made by the Ivorien President, Alassane Ouattara, on behalf of the eight countries, namely Benin Republic, Burkina Faso, Guinea-Bissau, Mali, Niger, Senegal, Côte d’Ivoire and Togo Republic.
The adoption of the common currency, expected to be issued in June 2020, is part of efforts by ECOWAS to realise its over 30 years’ aspiration to establish a single currency among its members and ensure regional economic integration in the region.
Ghana had applauded the decision of its Francophone counterparts to break from the shackles of the French colonialism to team up with their ECOWAS colleagues.
Many analysts described the French President, Emmanuel Macron’s role in the eight former colonial territories as an attempt to hijack the ECO single currency project.
But, at the end of the extra-ordinary meeting, the Ministers of Finance and the Governors of the Central Banks of the West African Monetary Zone ((WAMZ) on the ECOWAS single currency programme condemned the eight countries for taking a unilateral decision over the issue.
The meeting held at the CBN headquarters in Abuja under the chairmanship of the Minister of Finance and Economy of the Republic of Guinea, Mamadi Camara. The six countries frowned at the conduct of their counterparts.
The representatives of the affected countries described the “unilateral renaming of the CFA Franc as ECO by 2020 as inconsistent with the decision of the Authority of the Heads of State and Government of ECOWAS for the adoption of the ECO as the name of an independent ECOWAS single currency.”
“WAMZ Convergence Council would be recommending an extraordinary summit of the Authority of the Heads of State and Government of the WAMZ member states will be convened soon to discuss this matter and other related issues,” the communique read.
The English version of the communique was read by the Nigerian Minister of Finance, Budget and Economic Planning, Zainab Ahmed, while the Minister of Economy and Finance of the Republic of Guinea, Mamadi Camara, read the French version.
Other representatives present at the meeting include the Minister of finance and Economic Affairs of the Republic of Gambia, Mambury Njie; Minister of Finance of Ghana, Ofori Atta; Minister of Finance and Development Planning of Republic of Liberai, Samuel Tweah and Minister of Finance of Sierra Leone, Jacob Saffa.
Also, present were Senior Adviser, Central Bank of Gambia, Buah Saidy; Governor of the Bank of Ghana, Ernest Addison; Governor of the Central Bank of Nigeria, Godwin Emefiele.