Paragraph 1: The Call for Inclusive Tax Reforms in Nigeria
Nigerian stakeholders, including individuals, organizations, and private sector representatives, have urged the National Assembly to meticulously consider the concerns raised during the public hearing on the proposed tax reform bills. These stakeholders emphasized the importance of incorporating public input into the bills before their passage, expressing skepticism about the legislature’s genuine commitment to reflecting the diverse perspectives of Nigerians. The public hearing, which concluded in October 2024, centered on four key bills: 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, originating from recommendations by the Presidential Taskforce on Fiscal Policy and Tax Reforms, aim to overhaul the Nigerian tax system.
Paragraph 2: Navigating Political Landscape and Initial Resistance
President Bola Tinubu’s administration considered the public hearing a significant achievement, especially given the initial criticisms from prominent northern leaders, the Nigeria Governors’ Forum (NGF), and several northern lawmakers. The bills had encountered resistance in the House of Representatives, which insisted on their withdrawal for broader consultation, contrasting with the Senate’s swift approval for a second reading. A compromise was eventually reached after a meeting between the NGF and the tax reform committee, where a revised VAT distribution formula was agreed upon, addressing the governors’ concerns about equitable resource allocation. This revised formula proposed a 50% allocation based on equality, 30% on derivation, and 20% on population.
Paragraph 3: Public Concerns and Expert Opinions
Stakeholders raised numerous concerns during the public hearing, particularly regarding the proposed biennial VAT increment outlined in the Nigeria Tax Bill 2024. The Congress of University Academics (CONUA), for instance, opposed the VAT increase, advocating for maintaining the current 7.5% rate and broadening the tax base to include more taxable items. Legal and public affairs experts weighed in on the potential impact of ignoring public input. Senior Advocate of Nigeria, Mike Ozekhome, warned against prioritizing political interests over substantive public concerns, while constitutional lawyer, Abdul Mahmud, highlighted the risk of the public hearing becoming a mere formality due to the perceived influence of the executive branch on the National Assembly.
Paragraph 4: Concerns about Executive Influence and Political Dynamics
Mahmud’s concerns extended to the dominance of the ruling party within the legislature, suggesting that many lawmakers might be more inclined to support executive-backed proposals rather than prioritize public interests. He urged civil society, professional bodies, and the business community to actively advocate for the incorporation of stakeholder recommendations. Public affairs commentator, Jide Ojo, echoed these concerns, emphasizing the significant influence of the NGF and the possibility that public input might be disregarded if the governors’ interests were already secured. Anthony Sani, a chieftain of the Arewa Consultative Forum, acknowledged the weight of the governors’ position on the tax reforms, emphasizing their crucial role in shaping national policies.
Paragraph 5: Legislative Assurances and Next Steps
Despite the concerns raised regarding the potential marginalization of public input, James Faleke, Chairman of the House of Representatives Committee on Finance, assured the public that the Green Chamber was committed to enacting tax laws that reflect the interests of Nigerians while fostering economic growth and fiscal sustainability. He stated that the committee would diligently review all submissions received during the public hearing and strive to pass tax laws aligned with the aspirations of the Nigerian people. This commitment offers a glimmer of hope for a more inclusive and responsive legislative process.
Paragraph 6: The Path Forward and Lingering Doubts
The tax reform bills are expected to return to both chambers of the National Assembly for their third and final reading shortly. While the legislative assurances offer a positive sign, the lingering doubts about the true weight given to public input remain a significant concern. The potential for political expediency to override genuine consideration of stakeholder recommendations continues to overshadow the process. The coming weeks will be crucial in determining whether the National Assembly genuinely incorporates public feedback or merely proceeds with a pre-determined outcome dictated by executive and gubernatorial interests. The ultimate fate of the tax reform bills will significantly impact the Nigerian economy and the lives of its citizens, underscoring the importance of a truly participatory and transparent legislative process.
