Nigerians have urged the National Assembly to carefully consider the concerns raised by individuals, organizations, and the private sector regarding the tax reform bills. They called for a thorough review of the bills to address the issues presented by those who submitted memos and participated in the public hearings.
Despite the public consultations, there are concerns about the National Assembly’s willingness to incorporate Nigerians’ feedback into the final bills before their passage.
The National Assembly recently concluded the public hearings on the four bills, with the Senate Committee on Finance starting the engagement on Monday, and it ended at the House of Representatives. Speaker Tajudeen Abbas assured the public that their input would be prioritized as the parliament finalizes the bills ahead of their passage.
The public hearings were seen as a crucial step for President Bola Tinubu’s administration, particularly with the strong opposition from prominent northern leaders, the Nigeria Governors’ Forum, and many northern lawmakers. These bills were presented to the National Assembly in October 2024 by Tinubu, following recommendations from the Presidential Taskforce on Fiscal Policy and Tax Reforms, chaired by Taiwo Oyedele.
The proposed legislation includes the Nigeria Tax Bill 2024, the Nigeria Tax Administration Bill, the Nigeria Revenue Service (Establishment) Bill, and the Joint Revenue Board (Establishment) Bill. While the bills faced minimal resistance in the Senate, which quickly passed them for a second reading, the House of Representatives called for their withdrawal to allow for broader consultations. A compromise was reached in January 2025 after discussions between the Nigeria Governors’ Forum and the tax reform committee, which resulted in a revised proposal to ensure equitable VAT distribution.
The discussions led to agreement on a revised VAT sharing formula, with 50% based on equality, 30% on derivation, and 20% on population. This development prompted opposition lawmakers in the House to support the debate on the bills.
Many stakeholders raised concerns about various aspects of the bills, urging the National Assembly to consider economic realities, the living conditions of Nigerians, and the protection of industries. One major concern was the planned increase in VAT, scheduled every two years. The Congress of University Academics opposed the proposed VAT hike, recommending that the current 7.5% rate be maintained, with efforts to broaden the tax base.
Senior Advocate of Nigeria, Mike Ozekhome, warned that it would be a disservice to the nation if the National Assembly ignored the concerns of Nigerians. He expressed fears that political interests might overshadow public input in the passage of the bills.
Constitutional lawyer Abdul Mahmud echoed these concerns, suggesting that the public hearings could be rendered meaningless if the National Assembly disregarded the public’s input. He highlighted the potential for the legislature to prioritize the interests of the presidency and state governors, rather than those of the people.
Public affairs commentator Jide Ojo also pointed out the influence of the Nigeria Governors’ Forum, questioning whether the concerns of other stakeholders would be given due consideration in the final version of the bills.
Anthony Sani, a chieftain of the Arewa Consultative Forum, emphasized that the position of the governors must be taken into account, noting that their concerns regarding the VAT distribution changes were central to the ongoing discussions.
Meanwhile, James Faleke, Chairman of the House of Representatives Committee on Finance, reiterated the committee’s commitment to enacting tax laws that reflect the interests of Nigerians while promoting economic growth. He assured that all submissions would be reviewed and that the committee would work towards finalizing the tax reforms.
The bills are expected to return to both chambers next week for the third and final reading.
