Senate Passes Tax Reform Bills For Second Reading
The Senate on Thursday passed the four tax proposals for second reading through voice votes.
President Tinubu Bola handed the four tax reform proposals to the National Assembly for consideration on October 3.
The action sparked controversy with the Northern governors and other parties kicking against the tax reforms. Worried about the situation, the Presidency clarified that the bills were meant to develop the country as a whole, not any one region in particular.
A bill to establish the Joint Revenue Board, the Tax Appeal Tribunal, and the Office of the Tax Ombud was approved by the Senate via second reading as part of Tinubu’s comprehensive tax reform package. Harmonisation, coordination, and the resolution of conflicts resulting from revenue administration in Nigeria are the goals of the proposed legislation.
During the session, legislators discussed the broad strokes of the tax reform proposals. Following the recommendations of the Tax Reforms Committee, which was chaired by Taiwo Oyedele, the four bills that were transmitted by President Tinubu on September 3, 2024, were discussed earlier in a closed-door session of the Senate.
Despite widespread agreement that the changes were necessary to modernise Nigeria’s tax system and alleviate taxpayer burdens, Sen. Ali Ndume voiced concerns regarding the bill’s timing and some of its provisions.
Oyedele Claims That Over 60 Taxes and Levies Collected Across Nigeria Have Produced Nothing
The reforms, he said, could be reintroduced and passed “in less than 24 hours” with the adjustments that were desperately needed.
But the Chief Whip was adamantly against this idea, stressing how critical it was to get the bill on to the public hearing stage.
After first reading, the bill should move on to the public hearing, where it will be carefully reviewed. After then, it can be reviewed clause by clause.
I am not opposed to any reforms; reforms are essential, according to Sen. Ali Ndume, the lone dissenting voice. I would like to add to Senator Seraike’s remarks, however the time is an issue because it is currently happening in Nigeria.
One will be present at the public hearing and will address the derivation issue; this is necessary because certain provisions of the Bill cannot be implemented without first amending the Constitution.
After consulting with the NEC, traditional rulers, and governors, we will revise and resubmit this measure.
“I looked at the bill and it contains so many but these two things VAT and Derivation. You negotiate initially before we come to adopt a position.
“It looks attractive but it may not be what it is. You can bet that the producer will pass the cost of higher taxes on to buyers.
The individual in Nnewi who is unable to produce billions is being charged with the same person who is sitting around doing nothing, according to the bill, which states a drop from 30% to 25%.
On October 3, President Tinubu Bola sent four legislation to overhaul taxes to the National Assembly for review.
There are two bills that are expected to be passed soon: the Nigeria Tax Bill 2024 and the Tax Administration Bill. The former will lay out the fiscal framework for taxes in the country and the latter will provide a clear and concise legal framework for all taxes in the country, with the goal of reducing disputes.
The other two bills are the Nigeria Revenue Service Establishment Bill and the Joint Revenue Board Establishment Bill. The former will replace the Federal Inland Revenue Service (FIRS) Act with the latter, and the latter will also establish a tax tribunal and an ombudsman.
The president said the measures would help Nigeria’s budgetary institutions and would be in line with the administration’s larger development objectives.