The outbreak of Coronavirus disease (COVID-19) and its rapid spread across the world has introduced a new wave of disruption never seen before.
The health systems have been stretched to the limits and the economic impacts are taking their toll on government revenues, businesses, families and individuals across the world. This has prompted various governments across the world to introduce fiscal and economic stimulatory measures to ameliorate the impact of the pandemic on taxpayers and save their economies from collapse.
Below is a summary of the tax and economic measures announced by the Federal Inland Revenue Service (FIRS), Central Bank of Nigeria (CBN) and proposals by the House of Representatives (HORs) in the Emergency Economic Stimulus Bill, 2020 (“the Bill).
Tax measures by the FIRS
On Monday, 23 March 2020, the FIRS announced health and safety protocols for physical visits to its offices and the following measures to mitigate the impact of COVID-19 on taxpayers:
Economic measures by the CBN
The CBN announced policy measures worth N3.5 trillion, that include:
Additionally, the CBN has taken steps towards adoption of a uniform US Dollar to Naira exchange rate by increasing its intervention rate at the Investors and Exporters’ (I&E) Window of the FX market from N366 to N380 to the dollar and prescribing a similar rate at the end users’ retail market. While increasing the official rate from N306 to N360 per dollar has narrowed the gap between the official rate, the end user rate, and I&E Window intervention rate, it has only effectively replaced the multiple exchange rate regime with a dual exchange rate regime. It is hoped that sooner than later, the CBN will move from the new dual exchange rate to a market-driven uniform exchange rate regime for full transparency in the operation of the FX market and accounting for public revenue and expenditure.
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