The Federal Government through the 2020 Finance Bill is proposing the exemption of minimum wage earners from paying Personal Income Tax.
President Muhammadu Buhari, who stated this in Abuja on Monday, said the measure is to reduce the impact of inflation on Nigerians.
Speaking at the opening session of the 26th Nigerian Economic Summit Group Conference with the theme: “Building Partnerships for Resilience,” he said when added to other items in the proposed bill and various economic policies, the incentives would ensure the resilience of the Nigerian economy to exogenous shocks.
Represented by Vice President Yemi Osinbajo, the president said: “We are proposing in the new Finance Act that those who earn minimum wage should be exempted from paying income tax.
“These provisions which complement the tax breaks given to small businesses last year will not only further stimulate the economy, but are also a fulfilment of promises made to take steps to help reduce the cost of transportation and the impact of inflation on ordinary Nigerians.”
Explaining the role of the private sector in building a resilient economy, President Buhari said “this government has always emphasized that the private sector has a key role to play in our efforts to build a more resilient and competitive economy as expressed in the Economic Recovery and Growth Plan.
“Private companies in design, construction, logistics and finance are very much engaged in our infrastructural projects in power and rail as well as road and bridges and the installation of broadband infrastructure which is an essential requirement if Nigeria is to participate actively and benefit from the 4th Industrial Revolution.”
The President added: “…it is clear that we must diversify the economy away from dependence on crude oil exports, speed up human capital development and improve on infrastructure.
“Above all, our economy must be made more resilient to exogenous shocks. It is important for the private sector to play a key role as we work together to identify national priorities and try to influence our future national trajectory.”
The President also gave insights to the collaboration between the CBN, the Nigerian Sovereign Wealth Investment Authority (NSIA) and other stakeholders in the creation of an Infrastructure Company (Infraco) Fund to address some of the nation’s critical infrastructure needs.