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Ribran Tax Alert - Finance Act 2020
The Finance Act, 2020 (the Act) was assented to by the President on June 30, 2020, and has introduced various policy and taxation measures for revenue generation in support of the National Budget for the financial year 2020/21. The measures in the Act can be seen to target an increased tax base with the introduction of minimum tax and the digital service tax as well as disallowing certain categories of expenses in the computation of taxable income. The measures are also a delicate balance between revenue generation and incentives to bolster the revival of the economy, more so in the wake of the Covid-19 pandemic.
All the provisions relating to income tax have an effective date of 1 January 2021 while most of the other amendments come into force on the date of assent.
In this Alert, we discuss the salient features of the Act and their likely impact on taxpayers.