Toba Owojaiye reporting
Abuja, Nigeria
The discussion around President Bola Tinubu’s Tax Reform Bills has gained momentum as governors soften their stance following clearer explanations of the proposed changes. These reforms aim to address systemic challenges such as multiple taxation and inequities in Value Added Tax (VAT) distribution.
Truth Live News gathered that key proposals include redistributing VAT proceeds to favor the states of supply and consumption (60%) rather than focusing on the location of company headquarters. This shift is intended to promote fairness and discourage states from imposing their own consumption taxes, which could burden businesses further. Additionally, the bills seek to harmonize taxes and integrate revenue collection systems to improve efficiency without dissolving public agencies like TETFUND and NASENI.
The executive governor of Nassarawa state Engr A A Sule stated:
“If Mr. Taiwo Oyedele had informed the governors that a new model of 60% VAT distribution for better equity is part of the reform, there wouldn’t have been much disagreement from the onset. This Town Hall conversation was what the Governors’ Forum requested before proceeding with the bill’s consideration.”
Stakeholders such as Taiwo Oyedele, chairman of the Presidential Committee on Fiscal Policy and Tax Reform, and Yakubu Dogara, former Speaker of the House of Representatives, have highlighted the economic opportunities these reforms present. Oyedele clarified that the reform exempts low-income earners from income tax while progressively increasing rates for high-income individuals. Dogara pointed to potential revenue gains for Northern Nigeria through livestock and mineral resource exploration, emphasizing that reform is essential for wealth creation.
The bills also propose reducing the corporate income tax rate, simplifying tax compliance for businesses, and eliminating minimum taxes on low-margin companies. These measures aim to boost economic activities and improve Nigeria’s tax-to-GDP ratio without raising the overall tax burden.
Mallam Buba Yusuf, CEO of Global Investment and Trade Company, described the bills as essential for Nigeria’s economic revival, urging citizens to engage directly with the content rather than relying on misinformation. He stated:
“The bills are well-envisioned for competitive revenue generation and equitable distribution. Nigerians, especially Northerners, should read the bills to understand their transformative potential.”
Governors, initially resistant, are now reconsidering their positions, particularly after understanding the equitable benefits of the new VAT distribution model and other economic incentives outlined in the bills. This shift signals a critical step toward achieving a more inclusive and streamlined tax system for Nigeria.