On 7 December 2021, the President, Muhammadu Buhari, transmitted the Finance Bill 2021 through a letter to the Senate for consideration. In the letter, the President explained that the Finance Bill seeks to support the implementation of the 2022 Federal Budget of Economic Growth and Sustainability by proposing key reforms to specific taxation, customs, excise, fiscal and other relevant laws. Some of the amendments are given below:
- A 5% capital gains tax rate was proposed on the gains from disposal of shares in any Nigerian company when the gross proceeds from such sales in any 12 consecutive months exceed ₦500million (except if the proceeds are reinvested in shares of the same or other Nigerian company within the same year of assessment).
- Introduction of an election by taxpayers in respect of the reduced minimum tax rate of 0.25% available to mitigate the impact of the coronavirus (COVID-19) pandemic. Eligible companies would claim the incentive for any two accounting periods ending on any date between 1 January 2019 and 31 December 2021.
- Anti-avoidance provisions for business reorganization CITA empowers the FIRS to grant certain exemptions on group reorganizations, where certain criteria are fulfilled.
- Proposed to introduce rules to claim an incentive with regard to downstream gas utilization projects.
