On 31 December 2021, His Excellency, President Muhammadu Buhari, GCFR, signed the Finance Bill, 2021 into law as Finance Act, 2021.
The Finance Bill, 2021 was an Executive Bill prepared by the Honourable Minister for Finance, Budget and National Planning, and presented by His Excellency, President Muhammadu Buhari, together with the 2022 Budget proposals, to the National Assembly of Nigeria. The Bill was subsequently reviewed and passed by the National Assembly on Tuesday, 21 December 2021 prior to assent by the President to culminate into Finance Act, 2021 (hereinafter referred to as “Finance Act”, “FA 2021” or “the Act”).
Finance Act, 2021 introduces changes to the Capital Gains Tax Act (CGTA), Companies Income Tax Act (CITA), Personal Income Tax Act (PITA), Tertiary Education Trust Fund (Establishment, etc.) Act (TETA), Customs and Excise Tariff Etc. (Consolidation) Act (CETA), Value Added Tax Act (VATA), Stamp Duties Act (SDA), Federal Inland Revenue Service (Establishment) Act (FIRSEA), The Insurance Act (IA), Nigeria Police Trust Fund (Establishment) Act (NPTFA), National Agency for Science and Engineering Infrastructure Act (NASENIA), Finance (Control and Management) Act (FCMA) and the Fiscal Responsibility Act (FRA). The changes to these laws became effective on 1 January 2022. Further, the Act amends its predecessors, Finance Acts 2019 and 2020, to modify some of the amendments introduced by these Acts to provide clarity and make them more consistent with the government’s fiscal plans and current economic realities.
The passage of the Act reinforces the Federal Government (FG)’s commitment to making incremental changes to Nigeria’s fiscal framework, and these changes continue to be pivotal to achieving Nigeria’s economic growth and development imperatives.
The amendments made by the Act are intended to signal continuing expansion of the fiscal net and harmonisation with international best practice for the taxation of new areas of the modern global economy, particularly global digital trade, improve administration and mobilise revenue for the government.
