Base on the prevailing economic reality in Nigeria, the rate of tax paid by workers becomes cumbersome such that the was clarion calls from all length to adjust the take rate to tally with the emerging economic reality in the country, as such the signing into law the new personal income tax (amendment) all 2011 by the Dr. Goodluck tbelce Jonathan led administration came justifying the reality of the moment, and have received several applauses from all areas, tax payers, citizen and, indeed, taxable workers and virtual from all well meaning Nigerians and professionals in the field, if have also remained one of the present administration. The proper employed secondary approaches in sourcing its data for the compiling and writing of this literature.
The previous tax law mounted much pressure on all taxable brackets (individuals) and judging from emerging economic changes and realities, there was calls from all length for change in the tax law.
President Goodluck tbele Jonathan’s have left enormous mark that postenties to come will remember the administration for; on 13th December, 2011 while presenting the 2012 Federal Government Budgetary proposal pointed out to the joint session of the National Assembly that the personal income tax (amendment) bill has been signed into law, the amendment which was dated 14th June 2011 confirmed the Bill now known as personal income tax (amendment) Act 2011. the previous tax law had a low tax rate imposed on workers with minimum income, making it had for workers to survived with their little income and a lost of relatives and dependents. The long wanted changed in the personal income tax which finally came to be, provided workers with enormous tax cut; through, since the coming on board of the new personal income tax (amendment) act in December 2011, the seem to have calls from all basic ways of calculating of Nigerian workers payroll tax, adhering to the dictates and provisions of the new tax law such as the rates of calculating the Nigerians PAYE tax and the taxable items in the payship, and also, whether bonuses and leave allowances are taxable?
The personal income tax (amendment) Act 2011 scraped-off the old relies system that has no relationship with the modern day realities of workers earnings and the prevailing economic observances and happenings in the system; it has increased relief for all workers through it’s provision of Consolidated allowanced relief.
Outstanding Contents Of the New Law Areas Followings, As Put Forward By Federal Republic of Nigerian Official Gazewte (2011)
1. Consolidated relief: Under this provision, it provides for
N200, 000 or 1% grosses income relief as allowance which either is higher.
v Plus 20% of gross/total income
v Minimum tax is 1% of gross pay
The rate of tax paid by workers cont. from NEXT page