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Wednesday, 16 November 2016

Senate moves to amend Companies Income Tax Act

The Senate yesterday took steps to amend the Companies Income Tax Act.

A bill for an Act to amend the Companies Income Tax Act CAP C21 LFN 2010 and for matters connected therewith 2016, sponsored by Senator Andy Uba, (Anambra South) scaled second reading in the upper chamber.
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The bill specifically sought to amend Sections 34, 36, 39 and 40 of the principal Act.

Senator Uba in his lead debate noted that the proposed amendments aimed at encouraging investments in the industrial and mining sectors of the economy especially in the rural areas where ordinarily it would have been unattractive to invest.

The Anambra South lawmaker said that the bill seeks to stimulate economic activities through greater tax incentives, to engender economic development, promotion of industrialization and job creation in the country.

Uba said, “When the bill is passed into law, it is expected that the economic activities that would be generated through tax moratorium assured by the proposed Act, will generally provide the hitherto elusive employment opportunities for our qualified youths who today are roaming the streets of the urban areas in search of non-existent jobs."

He noted that the bill is one of the potent tools that could trigger the much-desired investments in local manufacturing and industrialization by both foreign and local companies.

The bill, he added, would also provide an opportunity for the development of rural areas and the provision of infrastructure by those in the private sector.

The lawmaker posited that the expected economic activities to be generated by virtue of the provisions of the amendments sought are to be concentrated in the rural and semi-urban areas, where infrastructures are lacking.

Uba told his colleagues that  the new clauses in the bill canvassed a ten-year tax exemption for a new company going into business where infrastructures such as electricity, water, or tarred road are not provided by government.

He said that companies with investment in the mining and gas industries would be exempted for five years.

Senate President, Abubakar Bukola Saraki described the bill as “very important.”

Saraki said that there was no doubt that if eventually passed the bill would stimulate the country’s economy and create employment in the parts of the country.

It referred to the committee on Labour and Productivity for further legislative action.

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