The journey towards the Finance Act, 2018, has been a dramatic one.
The journey towards the Finance Act, 2018, has been a dramatic one. Not often do tax amendments get the prominence enjoyed by the Finance Act, 2018. To start with, the Finance Bill, 2018 on the face of it, looked like any other Finance Bill, introducing routine amendments to the various tax and other related laws. However, it was the key provisions and omissions from the 2018 Finance Bill that provoked debate.
The first and possibly best known debate was VAT on fuel. The omission of the extension provision caused a lot of hue and cry, not least because of the knock on and potential inflationary impact that raising the cost of fuel has on the economy. By increasing the cost of petrol and diesel, for example, we can expect that the prices of anything that depends on transport will also correspondingly rise. After very heated debates, this has now been settled and VAT on fuel applies at 8%.
The other provision that also elicited heated debate was that on the removal of interest rate caps. Again, a lot of debate on this one and some slight movement as the Finance Act, 2018 adopted a compromise position by abolishing the lower limit of interest to be paid on balances in savings accounts.
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