The vice president also said that the Federal Government, like it did in 2019, was offering a range of tax incentives through the 2020 Finance Bill so as to attract more incentives and make doing business in Nigeria more competitive.
Osinbajo’s spokesman, Laolu Akande, in a statement on Friday, said the vice president spoke at the third edition of the Nigeria Diaspora Investment Summit which was held virtually.
The summit featured several Nigerians and prospective investors from the Diaspora.
“What we have done in furthering our own economic policy is to attempt to make the fiscal environment as attractive as possible.
`What we have done is to use the instrumentality of the Finance Acts to make or propose significant reforms.’’
He said that the Finance Bill looked at several fiscal issues that needed legislation or amendments which would make it easier for government to implement the budget and ease the fiscal environment or make the fiscal environment friendlier.
The vice president said that the Federal Government started by passing the Finance Act in 2019 and had proposed second Finance Act in 2020.
“Last year, we passed a legislation giving small companies with a turnover of less than N25 million a year, tax exemption from the Companies Income Tax.
“Medium-sized companies with their turnover of between N25 million and N100 million now pays Companies Income Tax at the lower rate of 20 per cent.
“And then, services provided by Micro Finance Banks are completely exempted from VAT. So, no microfinance bank pays VAT now for its services.
“Withholding tax rates, also on roads, on bridges, on buildings, power plant construction contracts have been reduced from five per cent to 2.5 per cent.
“Those who are doing construction contracts and proposing for construction contracts, pay a reduced rate, they no longer pay five per cent; they now pay 2.5 per cent.
“Now in the proposed 2020 finance bill, we have gone a bit further; we are reducing by 50 per cent; the minimum tax rate.
“So the minimum tax rate used to be 0.5 per cent; now is reduced to 0.25 per cent for gross turnover for the financial years ending between Jan. 1, 2020 and Dec. 31, 2021.
“So we have reduced the minimum tax rate by 50 per cent, by half.”
Osinbajo acknowledged the efforts of Abike Dabiri-Erewa, the Chief Executive Officer of the Nigerians in Diaspora Commission (NIDCOM) in harnessing the resources and talents of Nigerians abroad.
“The diaspora initiatives that we have and all of your efforts are certainly appreciated and will result to a stronger economy for Nigeria and a better country,” he said.
The investment summit is an annual feature of the Nigerians in Diaspora Commission (NIDCOM). (NAN)