President Bola Tinubu has chosen to move forward with his administration’s ambitious tax reform bills, rejecting the National Economic Council’s (NEC) recommendation to withdraw them.
The NEC, led by Vice President Kashim Shettima and made up of Nigeria’s 36 state governors, voiced concerns about the proposed bills during a meeting on Thursday.
In their view, the bills require further consultation due to disagreements raised by various groups and stakeholders.
Despite their concerns, President Tinubu has decided to keep the bills in the legislative process.
According to presidential spokesperson Bayo Onanuga, Tinubu appreciates the NEC’s input but believes that withdrawing the bills would be unnecessary.
Instead, he argues that the National Assembly’s legislative process will provide the opportunity for any needed changes or additions.
In a statement released on Friday, Onanuga emphasized the president’s stance, saying, “President Tinubu encourages the NEC to allow the legislative process to run its course.”
The President also expressed his willingness to consider further consultations and discussions with relevant stakeholders as the bills go through the National Assembly.
These tax reform bills, presented earlier this year, aim to reshape Nigeria’s tax administration and align it with global standards.
The bills include four main proposals: the Nigeria Tax Bill, the Nigeria Tax Administration Bill, the Nigeria Revenue Service Bill, and the Joint Revenue Board Establishment Bill.
Each bill serves a unique purpose within the overall framework of tax reform, with the primary goal of reducing the complexity and redundancy of Nigeria’s tax structure.
The Nigeria Tax Bill, for example, focuses on eliminating multiple layers of taxation to simplify the tax burden on businesses and individuals across the country.
Through this bill, Tinubu’s administration hopes to make Nigeria’s economy more competitive by encouraging investment and business growth.
The Nigeria Tax Administration Bill introduces new rules for overseeing tax collection at the federal, state, and local levels.
This bill aims to make it easier for taxpayers to comply with regulations, while also boosting revenue for all levels of government.
The Nigeria Revenue Service Bill proposes transforming the Federal Inland Revenue Service (FIRS) into the Nigeria Revenue Service, or NRS.
This change reflects the agency’s goal of overseeing tax collection across the federation, not just for the Federal Government.
Finally, the Joint Revenue Board Establishment Bill aims to create a Joint Revenue Board to replace the existing Joint Tax Board.
This new board would oversee tax matters between federal and state tax authorities, while also establishing an Office of Tax Ombudsman.
The Ombudsman would be responsible for protecting taxpayer rights and handling disputes, creating a fairer process for all Nigerians.
The tax reform bills were drafted based on recommendations from the Presidential Committee on Tax and Fiscal Policy Reform.
Formed in August 2023, the committee conducted extensive consultations with a wide range of groups, including trade associations, government agencies, professional bodies, business owners, and ordinary citizens.
Their findings, gathered over a year, culminated in the current tax reform proposals now under consideration by the National Assembly.
President Tinubu has consistently expressed his commitment to overhauling Nigeria’s tax system to promote economic growth and efficiency.
In his view, Nigeria’s current tax laws and administration practices are outdated and have long hindered the country’s development goals.
The proposed reforms aim to reduce Nigeria’s dependence on oil revenue by improving non-oil tax collection and efficiency.
In the current system, taxes such as Company Income Tax (CIT), Personal Income Tax (PIT), Capital Gains Tax (CGT), Petroleum Profits Tax (PPT), and Value-Added Tax (VAT) are administered separately.
This fragmented approach has led to overlapping responsibilities, inefficiency, and confusion for taxpayers.
