President Bola Tinubu has turned down the National Economic Council’s (NEC) recommendation to withdraw the contentious tax reform bills presently under review. This decision emerged from the 144th NEC meeting, led by Vice President Kashim Shettima, where representatives, including governors from 19 northern states and key traditional rulers, voiced concerns regarding the bills, particularly the proposed adjustment to the Value Added Tax (VAT) distribution structure. The governors argued that the provisions in the Nigeria Tax Reform Bill do not favor the North and other regions.
On September 3, President Tinubu had presented four tax reform bills to the National Assembly during his time in London, with a formal letter to the Speaker of the House, Abbas Tajudeen. These proposed laws consist of the Nigeria Tax Bill 2024, aimed at building a robust national tax framework, and the Tax Administration Bill, which seeks to establish a structured and transparent system for tax collection. Additionally, the Nigeria Revenue Service Establishment Bill proposes replacing the existing Federal Inland Revenue Service Act to form the Nigeria Revenue Service, and the Joint Revenue Board Establishment Bill looks to create a tax tribunal and ombudsman.
President Tinubu, through a statement by his media aide Bayo Onanuga, acknowledged the NEC's recommendation but emphasized that the legislative process offers ample room for input and potential amendments. He expressed appreciation for the NEC’s counsel, particularly from Vice President Shettima and the 36 State Governors, but insisted on allowing the legislative procedures to proceed without halting the bills' progression.
"President Tinubu has received the National Economic Council’s recommendation for further consultation on the tax reform bills before the National Assembly," the statement read. "He values the input of NEC members and believes the ongoing legislative process will enable necessary amendments."
President Tinubu also encouraged further consultations with relevant stakeholders, asserting that the established legislative framework and upcoming public hearings at the National Assembly will allow ample opportunity for any remaining reservations to be addressed.
When establishing the Presidential Committee on Tax and Fiscal Policy Reform in August 2023, President Tinubu’s aim was clear: to improve Nigeria’s economic productivity, foster efficiency, and enhance the investment climate. Over the past year, the committee gathered feedback from a wide range of societal sectors, including trade unions, professional organizations, government ministries, state governors, businesses, and civil society groups.
The resulting tax reform bills reflect the committee's extensive analysis and aim to streamline Nigeria’s tax administration, revolutionize its operational framework, and align it with global standards. President Tinubu reaffirmed the importance of these bills in strengthening Nigeria’s fiscal institutions and supporting the administration’s overarching goals for economic stability and growth.
