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By Chinwendu Obienyi
Following the suspension of the 2023 Finance Act by President Bola Tinubu, economic analysts have said this could disrupt the implementation of the budget and hinder the government’s ability to execute its planned programs and projects for the fiscal year in which the budget was prepared for.
According to them, the finance act is closely tied to national budgets, as they outline revenue sources and expenditure plans.
The huge tax burden has no doubt been a clog in the wheel of the overall performance of businesses over the years. There have been numerous fora expressing concern on the escalation of taxes, including exercise duties and its adverse implication on the business operating environment.
To curb multiple taxations as complained by a cross-section of Nigerians and the business community, President Bola Tinubu signed four Executive Orders, which include the suspension of the 5 per cent Excise Tax on telecommunication services as well as the Excise Duty escalation on locally manufactured products.
The suspension which now defers the commencement date of the changes contained in the Act from May 23, 2023 to September 1, 2023. This is to ensure adherence to the 90 days’ minimum advance notice for tax changes as contained in the 2017 National Tax Policy.
Reacting to the development, Futureview Group in an economic note sent to Daily Sun, said that the suspension of the 2023 finance act can create uncertainty and confusion among businesses, individuals, and investors as the act typically contains provisions related to taxes, tariffs, incentives, and other financial regulations.
“The Finance acts generally outline tax policies and regulations. The suspension of the act may affect the government’s ability to collect revenue effectively. It could lead to a decrease in tax compliance as individuals and businesses may be uncertain about their obligations or take advantage of the lack of clear guidelines.
The suspension to the finance act can also create a negative perception of the investment climate, potentially deterring both domestic and foreign investors”.
