Finance Act 2020: Key changes and implications

President Muhammed Buhari, on 31 December 2020, signed the Finance Act 2020 alongside the 2021 Appropriation Act into law. This reaffirms the Federal Government of Nigeria’s commitment to enact fiscal policy annually, alongside the passage of the annual budget into law (i.e. enactment of Appropriation Act) and aligns with global best practice.
The Finance Act 2020, which took effect on 1 January 2021, amended the provisions of 14 tax and fiscal related legislation, namely:

1. Capital Gains Tax Act (CGTA)
2. Companies Income Tax Act (CITA)
3. Industrial Development (Income Tax Relief) Act (IDITRA)
4. Personal Income Tax Act (PITA)
5. Tertiary Education Trust Fund (Establishment etc.) Act
6. Customs and Excise Tariff, etc. [Consolidation] Act (CETA)
7. Value Added Tax Act (VATA)
8. Stamp Duties Act (SDA)
9. Federal Inland Revenue Service (Establishment) Act (FIRSEA)
10. Nigeria Export Processing Zones Act (NEPZA)
11. Oil and Gas Export Free Zone Act (OGEFZA)
12. Companies and Allied Matters Act (CAMA)
13. Fiscal Responsibility Act (FRA)
14. Public Procurement Act (PPA)

In addition to the above, the Finance Act 2020 created a Crisis Intervention Fund (CIF) and its sub-fund, Unclaimed Funds Trust Fund (UFTF).

This newsletter gives an overview of the Finance Act 2020, analyses the key provisions vis-à-vis the changes to the primary legislation and highlights the potential tax implications for stakeholders.