Tax reform bills, future of Nigeria — Akpabio

…says not up to 30% of Nigerians pay tax

…RMAFC urges Senate to adopt governors’ position on new VAT formula

…How Tinubu asked us for workable tax laws — Committee chair

 

President of the Senate, Sen. Godswill Akpabio, on Monday, defended the controversial tax reform bills introduced to the National Assembly by President Bola Tinubu, saying that the bills would shape the future of the country’s economy.

He spoke in Abuja as the Senate Committee on Finance opened the long-awaited public hearing on the bills, urging all stakeholders to thoroughly examine the bills, considering the impact they would make on revenue generation and redistribution in the country.

The tax reform bills are, The Nigeria Tax Bill (NTB) 2024; The Nigeria Tax Administration Bill (NTAB) 2024; The Nigeria Revenue Service (Establishment) Bill (NRSEB) 2024; and The Joint Revenue Board (Establishment) Bill (JRBEB) 2024.

Akpabio noted that the misconceptions and fears about the bills were spread mostly by persons and groups that had hardly read the provisions.

He called all those opposing the bills to seize the opportunity of the public hearing to tell Nigerians why they believed the bills were bad for their well-being.

The Senate President stated, “The four bills, some leaders and elders have never read them. They only rush to the television to make comments.

“I call on all Nigerians, who are against the bills, to come and make their contributions. Don’t follow social media commentaries to act, read the bills.

“This is the future of Nigeria. These tax reform bills. All oversights by the Senate are suspended for now for us to devote enough time to the public hearing.”

Akpabio observed that while discussions or pronouncements about tax scare people, the truth remains that less than 30% of Nigerians pay taxes.

According to him, over-reliance on crude oil revenue has made many Nigerians to assume that paying taxes is unnecessary.

“At a time when oil revenue is dwindling, we have to think out of the box by sourcing money from other areas. This is a fact.

“I don’t think up to 30% of Nigerians pay tax. Yet, everyone wants good services and good governance.

“This is Nigeria. Nobody believes in the rule of law and nobody believes that tax works”, he added.

A long list of stakeholders attended the opening of the hearing on Monday.

They included the Minister of Finance and Coordinating Minister of the Economy, Mr Wale Edun; Office of the Attorney-General of the Federation; Minister of Trade and Investment, Jumoke Osuwole; Chairman of Federal Inland Revenue Service (FIRS) Mr Zacch Adedeji; Chairman, Revenue Mobilisation Allocation and Fiscal Commission (RMAFC), Mohammed Bello-Shehu; Institute of Chartered Accountant of Nigeria (ICAN); Association of National Accountants of Nigeria (ANAN); and the Nigerian National Petroleum Company Limited (NNPCL).

ALSO READ: Tinubu to Senate: Tax reform bills not skewed against any section of the country

The stakeholders mostly declared their backing for the bills, only recommending a few adjustments, but no major opposition so far.

In his submission, the RMAFC chairman, Bello-Shehu, drew the attention of the Senate to the position taken by the Nigerian Governors Forum on the bills, urging the legislature to incorporate it in their final report.

“We are 100% in support of the bills because they will free our funds and enhance economic development across the Federation.

“However, the issue of VAT distribution needs to be looked at for a new sharing formula.

“The committee should adopt and listen to the Governors’ Forum (NGF) on the new sharing formula. We fully support the reforms”, he added.

The NGF had initially opposed the bills after they were introduced in October 2024.

However, in January 2025, the governors announced that they supported the bills and recommended a revised Value Added Tax (VAT) sharing formula to ensure equitable distribution of resources of 50 percent based on equality, 30 percent based on derivation and 20 percent based on population.

A communique the group issued after a meeting, reads partly, “We, members of the Nigeria Governors’ Forum (NGF) and presidential tax reform committee, convened on the 16th of January 2025 to deliberate on critical national issues, including the reform of Nigeria’s fiscal policies and tax system, and arrived at the following resolutions:

“The Forum reiterated its strong support for the comprehensive reform of Nigeria’s archaic tax laws.

“Members acknowledged the importance of modernizing the tax system to enhance fiscal stability and align with global best practices.

“The Forum endorsed a revised Value Added Tax (VAT) sharing formula to ensure equitable distribution of resources: 50% based on equality, 30% based on derivation, and 20% based on population.”

It noted further, “The Forum advocated for the continued exemption of essential goods and agricultural produce from VAT to safeguard the welfare of citizens and promote agricultural productivity.”

Making his opening remarks earlier, the Chairman of the Senate Committee on Finance, Sen. Sani Musa (APC, Niger-East), said the Senate chose not to rush the bills because it wanted to address all the concerns raised by many Nigerians, hence the public hearing.

He disclosed to the gathering how President Bola Tinubu requested the Senate to pass tax laws that would be workable for the country.

Musa recalled, “I met President Bola Ahmed Tinubu (GCFR) two days ago on the tax reform bills and he told me that Mr Chairman, Senate Committee on Finance, go and do the needful.

“Give me a law that is workable from the tax reform bills I forwarded to the Senate and the House of Representatives in October last year.

“That request by Mr President came at a very auspicious time of this public hearing on the tax reform bills which are not meant to add burden to any section of the country or give undue advantage to any section as well.”

Musa spoke further, “The main purpose of the reform bills is to see how the government will generate more revenue so that we’ll be able to put our country on the pedestal of advanced economies where infrastructure, education, agricultural sector and virtually every sector that revolves around the ecosystem of the economy will be adequately taken care of.”

NIGERIAN TRIBUNE