The Chairman of the Presidential Committee on Fiscal Policy and Tax Reforms, Taiwo Oyedele, has clarified that the proposed tax reform bills before the National Assembly are not intended to disadvantage any region of the country.
Speaking at an interactive session on the bills organized by the House of Representatives, Oyedele emphasized that the reforms aim to improve tax efficiency and increase revenue for states where goods and services are consumed.
“There is no negative thinking about any region or anything,” he stressed.
Currently, under Section 40 of the VAT Act, the allocation of VAT revenue is divided as follows: 15 percent to the federal government, 50 percent to the states and the Federal Capital Territory, and 35 percent to local governments. Oyedele assured that there was no regional bias in the proposed reforms.
Speaker of the House of Representatives, Hon. Tajudeen Abbas, also addressed the proposed reforms, stressing that they would be thoroughly examined in the best interest of Nigerians. While the House has not yet taken a definitive position on the bills, Abbas emphasized that lawmakers have a duty to ensure the reforms serve the national interest, according to ThisDay.
Abbas explained that the four tax reform bills, which were presented by President Bola Tinubu, are crucial for expanding Nigeria’s tax base, improving compliance, and establishing sustainable revenue streams for national development. He said the interactive session was designed to provide lawmakers with a comprehensive understanding of the bills, facilitate dialogue on controversial areas, and build consensus. The session would also assess whether the bills are in alignment with the 1999 Constitution and other existing laws.
Abbas further highlighted the importance of tax reforms in achieving sustainable economic growth and development, noting that taxes are the foundation of public revenue, which is necessary for funding essential services like education, healthcare, infrastructure, and security. Despite being Africa’s largest economy, Nigeria’s tax-to-GDP ratio is just six percent, well below the global average and the World Bank’s minimum benchmark of 15 percent for sustainable development. Abbas stated that this gap needs to be addressed to reduce the country’s reliance on debt financing and ensure fiscal stability.
The Speaker stressed that the tax reforms would help diversify Nigeria’s revenue base, promote fairness, and create an environment conducive to investment and innovation. He urged lawmakers to approach the reforms with careful consideration, balancing the need for public revenue with the economic impact on individuals and businesses.
He stated, “The purpose of the interactive session is to provide members with a comprehensive understanding of the proposed bills and deepen their appreciation of their provisions, commence constructive dialogue on contentious or controversial areas, and build the consensus.
“The interaction will help identify areas that need amendment, clarification, or improvement as well as consider the compatibility of these bills with the 1999 Constitution (as amended) and other extant laws.
“Tax reforms form part of the provisions of the House Legislative Agenda because of their central role in achieving sustainable economic growth and development.”
Deputy Speaker Benjamin Kalu also assured Nigerians that the House is committed to developing a tax system that fosters equity, economic growth, and sustainable development. Kalu described tax policy as not just a fiscal tool but a catalyst for progress and inclusive prosperity. He emphasized that tax reforms must serve the collective aspiration to create a fair and effective tax regime for all Nigerians.
Zack Adedeji, Chairman of the Federal Inland Revenue Service, added that the agency is awaiting the outcome of the bills.
