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Nigerian Governors reject VAT Increase in Tax Reform Bills, Make new proposal

by iDeemlawful
written by iDeemlawful

The Nigeria Governors’ Forum has voiced its opposition to any impending increase in the Value Added Tax (VAT).

Their decision stems from concerns over the possible adverse economic impact on businesses and households, which are already grappling with rising inflation rates.

The decision was made during a meeting with the Presidential Tax Reform Committee in Abuja on Thursday.

In a communique issued after the meeting, the governors expressed support for the ongoing legislative process to modernise Nigeria’s tax laws but opposed a hike in VAT from the current 7.5%.

They endorsed a revised VAT sharing formula that allocates 50% of revenue based on equality, 30% on derivation, and 20% on population.

“We recognise the importance of fiscal reforms, but raising VAT at this time would place undue pressure on businesses and citizens,” NGF Chairperson and Kwara State Governor, AbdulRahman AbdulRazaq, said.

The governors also advocated for the continued exemption of essential goods and agricultural produce from VAT to protect citizens and promote food security.

In the Tax Reform Bills, they opposed including terminal clauses for development levies.

They highlighted the importance of continuous funding for agencies such as TETFUND, NASENI, and NITDA to ensure ongoing support for national development.

The tax reform bill was proposed to the National Assembly by President Bola Tinubu on October 3, 2024, they included the Nigeria Tax Bill 2024, the Nigeria Tax Administration Bill, the Nigeria Revenue Service Establishment Bill, and the Joint Revenue Board Establishment Bill.

These bills aim to overhaul tax administration and revenue generation in the country.

The bills are products of a year-long effort by the Taiwo Oyedele-led Presidential Committee on Fiscal Policy and Tax Reforms, inaugurated by President Tinubu in August 2023.

Meanwhile, before the agreement of the NGF, the Senate’s Ad-hoc Committee on tax reform, led by Senator Abba Moro on Monday, announced progress in deliberations on the bills.

“We have reached some agreements after thorough discussions with government officials. Our goal is to deliver a law that meets the needs of all Nigerians,” Moro said

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Tax Reform Bills set for passage as Senate, FIRS clear major hurdles

by iDeemlawful
written by iDeemlawful

The Senate is preparing to approve tax reform legislation after major stakeholders came to an agreement on previously debated topics.

Despite strong opposition, particularly from the North, the voices against the bills persist in their stance.

Chair of the Senate’s ad hoc Committee on Tax Reform, Senator Abba Moro, disclosed, yesterday that public hearings on the bills would soon be held, paving the way for a third reading.

Following a meeting with top officials, including Attorney General of the Federation, Lateef Fagbemi (SAN); Federal Inland Revenue Service (FIRS) Chairman, Zacch Adedeji; and other fiscal policy leaders, Moro expressed optimism about the progress made.

Speaking to journalists, Moro highlighted the collaborative effort to harmonise the tax reform process.

“We’ve engaged with the Attorney General, the FIRS Chairman, and other stakeholders to synthesize our positions. Our goal is to deliver a law that truly serves all Nigerians,” Moro said.

While Moro did not provide specifics on the changes made, he said substantial progress had been achieved, and further meetings would finalise the framework.

Adedeji reinforced the positive outlook, stating that most contentious issues in the bills had been resolved.

“All the so-called grey areas were identified and clarified during the discussions. The engagement has been very productive, and I can confidently say we are on the right track,” Adedeji said.

He added that the bills were critical to modernising Nigeria’s tax framework and ensuring better revenue mobilisation.

“To the best of my knowledge, everyone involved agreed on the importance of these reforms.

“Everyone agreed that Nigeria needs these laws. Today, we saw the framework of the law come together, with the Attorney General, lawmakers, and operators all on the same page,” he added.

The committee’s efforts mark a significant step towards overhauling Nigeria’s tax system.

With the reforms, it is expected to enhance revenue collection and create a more efficient tax framework

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JUST IN: Presidency warns Nigerians, Leaders over Opposition to Tinubu’s Tax Reform Bills

by Abduljelil Issa
written by Abduljelil Issa

The Minister of Information and National Orientation, Alhaji Mohammed Idris, has issued a warning to Nigerians and leaders to exercise caution in their opposition to President Bola Tinubu’s tax reform bills.

Idris stated that the president is committed to accountability on tax bills and will always act in the best interest of Nigerians.

The minister made this statement on Wednesday in Abuja, while reacting to the ongoing nationwide debate on the new tax reform bills currently before the National Assembly. He commended Nigerians for coming out to express their views and opinions on the bills, describing it as “the very essence and meaning of democracy.”

Idris, however, cautioned that all commentators and groups should strive to be respectful and understanding, despite their variety of opinions.

He emphasized that there should be no room for name-calling or the injection of unnecessary ethnic and regional smirch into the national conversation.

The minister also warned against the spread of misinformation and fake news circulating around the tax bills and the overall reform agenda of the Tinubu administration.

He said, “In the spirit of democratic engagement, there should be no room for name-calling or for the injection of unnecessary ethnic and regional slurs into this important national conversation.

“Similarly, it is important to be aware that there is a lot of misinformation and fake news circulating around the tax bills and the overall reform agenda of the Tinubu administration.

“The fiscal reforms will not impoverish any state or region of the country, neither will they lead to the scrapping or weakening of any federal agency.

“Instead, they will bring relief to tens of millions of hard-working Nigerians across the country and empower and position our states and the 774 local governments for sustainable growth and development,” he stated.

The minister explained further that, President Tinubu is implementing an ambitious fiscal reform agenda that would devolve more resources to states and local governments and ultimately, to Nigerians. He emphasized that the government has nothing minacious to warrant the suggestion that the process is being rushed.

Idris added that the Federal Government welcomes meaningful inputs that could address whatever possible grey areas in the bills.

He disclosed that President Tinubu has already directed the Federal Ministry of Justice and relevant officials who worked on the drafts to work closely with the National Assembly to ensure that all genuine concerns have been addressed before the bills are passed.

The minister expressed optimism that the reforms would facilitate increased revenues without imposing additional tax burdens on the people. He also stated that the reforms would make it possible for citizens to demand and enjoy greater accountability in the management of public resources at all levels of government. He concluded.

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Senate Suspends Public Hearing on Tax Reform Bill

by Abduljelil Issa
written by Abduljelil Issa

The Senate on Wednesday asked it’s committee on finance to put on hold the public hearing and other related issues on the Tax Reform Bills until all controversies surrounding the bills are resolved.

The Deputy President of the Senate, Senator Jibrin Barau who disclosed while addressing the Senate in plenary said Senate has also proposed a meeting with the Attorney General of the Federation on Thursday to sort out all the problems in the interest of this nation.

“It has been agreed by the executive and also by us that there should be a forum that will sit with the Attorney General of the Federation so that we can sit down and sort out all these problems in the interest of this nation.

“It’s on this note, that the committee on finance that the bills have been referred to, should put on hold further action on it’s public hearing and other issues until we resolve these issues,” he said.

Barau further said, “we understand at all times that this Senate is the highest assembly in this country. The Senate is composed of men and women of wisdom, of pedigree that this country has entrusted to legislate for them for the peace and tranquillity and the development of this country.

“The Senate of the Federal Republic, as known by everyone and indeed other Senate in the entire world, are known to be the stabilisers of every country. When there are difficulties and disagreements, the Senate of this country comes in with solutions through dialogue and consensus at all times to solve such problems, and the Senate of the Federal Republic of Nigeria has been doing that since 1999,” he said.

He said because of this, the senators decided to put politics, ethnicity, and regionalism aside to sit among themselves and find the way forward with respect to the issues surrounding the tax reform bills.

“We extended our view to the executive arm of government and it was agreed that there should be a forum to sit down to look at the areas that are creating disagreements to resolve them so that the entire country will remain united in our effort to solve our problems.

“Before the introduction of these bills, we know we’ve been faced with several problems and insecurity that we’ve been trying to proffer solutions to. The president has been trying, and we’re also working with him to solve issues about our economy, which is in line with global economic problems.
We also agree that we shouldn’t allow anything else to aggravate our country’s problems.

He further concluded by saying, “Barau all sides will be given the opportunity and we shall resolve the issues before anything is allowed to go”.

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Tinubu orders review of Tax Reform Bills after much pressure from Nigerians

by iDeemlawful
written by iDeemlawful

President Bola Tinubu has instructed the Ministry of Justice to work closely with the National Assembly to resolve the concerns raised by the contentious Tax Reform Bills.

While in South Africa, the president ordered a review of the proposed bills after a group of youths from the northern region of the country protested in support of them at the National Assembly.

The bills – the Nigeria Tax Bill 2024, the Nigeria Tax Administration Bill, the Nigeria Revenue Service (Establishment) Bill, and the Joint Revenue Board (Establishment) Bill – have generated hot debates and contention across the country with northern governors and lawmakers opposed to their passage.

Some critics had argued that the reforms could disrupt the balance of fiscal federalism, potentially centralising tax authority and diminishing state revenues.

Also, northern governors and some senators had expressed their reservations with the Bills, noting that it will impoverish Nigerians.

Hence, in order to calm frayed nerves, Tinubu directed the Federal Ministry of Justice and relevant officials who worked on the draft to collaborate with the National Assembly to address all genuine concerns before the bills were passed.

The President’s directive was contained in a statement signed by the Minister of Information and National Orientation, Mohammed Idris, titled: ‘President Tinubu committed to accountability on tax bills, directs Ministry of Justice to work with NASS on concerns.’

The minister said: “In line with the established legislative procedure, the Federal General welcomes meaningful inputs that can address whatever grey areas there may be in the bill.

“In this vein, President Tinubu has already directed the Federal Ministry of Justice and relevant officials who worked on the drafts to work closely with the National Assembly to ensure that all genuine concerns have been addressed before the bills are passed.”

Meanwhile, the president said there would be no need to withdraw the bill from the National Assembly amid the opposition that had trailed it.

The minister further said: “The fiscal reforms will not impoverish any state or region of the country, neither will they lead to the scrapping or weakening of any federal agencies.

The Federal Government welcomed the nationwide debate on the bills saying, “This is the very essence and meaning of democracy.”

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