President Bola Tinubu’s contentious tax reform bills once again stirred intense debate yesterday, sparking chaos during a House of Representatives plenary session, as prominent Nigerians and various interest groups nationwide continued to voice fierce opposition and unwavering support......Read The Full Article>>.....Read The Full Article>>
Trouble began at the Green Chamber following a controversial statement by Akintunde Rotimi Jr., spokesperson of the House, who openly declared support for the bills.
Rotimi Jr., representing Ekiti North I (Ikole/Oye), sparked the uproar while presenting a report on behalf of Boma Goodhead, chairperson of the Committee on Nigerian Content Development and Monitoring. He noted that the Ekiti State caucus in the National Assembly had unanimously endorsed the tax reform bills.
“I am from Ekiti State, the very first state in the National Assembly caucus to unanimously endorse the tax bill,” Rotimi Jr. said, prompting an outcry from northern lawmakers who vehemently oppose the reforms.
The aggrieved members disrupted proceedings, shouting “No!” repeatedly and halting the session for over five minutes.
Speaker Tajudeen Abbas intervened to calm the heated atmosphere, urging his colleagues to exercise restraint. “He was just speaking on a light note. Let us not take it seriously,” Abbas said, attempting to diffuse the tension. However, Rotimi Jr. was pressured to withdraw his statement, and the Speaker advised him to focus strictly on presenting the report.
Abbas further cautioned Rotimi Jr., saying: “Hon. Rotimi, you know this is a controversial issue. I wouldn’t want you to mention things that are not relevant to the subject matter. So, on your behalf, I withdraw that statement you made. Please proceed with your motion.”
Despite these efforts, Rotimi Jr. faced resistance as he attempted to continue his presentation, with lawmakers opposing the tax reform Bills shouting him down.
Among the most vocal critics was Dr Ghali Mustafa Tijjani, who represents the Gaya/Albasu/Ajingi federal constituency in Kano State under the New Nigeria Peoples Party (NNPP).
Tijjani expressed his concerns in an interview with The Guardian, warning against imposing additional taxes on citizens already struggling with economic hardships.
“The proposed tax reforms are capitalistic and will make ordinary Nigerians poorer,” Tijjani said. He called for alternative revenue-generating measures, such as curbing financial leakages and leveraging Nigeria’s mineral resources.
Tijjani also endorsed the Northern Governors’ Forum’s stance against the reforms, urging the government to prioritise infrastructure development over what he described as wasteful expenditures.
Tijjani criticised plans to increase Value Added Tax (VAT) rates from 7.5 per cent to 15 per cent by 2030, arguing that the burden would ultimately fall on consumers. “Even with exemptions for low-income earners, businesses will transfer the additional costs to the final consumer,” he explained.
Highlighting the economic challenges facing Nigerians, Tijjani advocated for tax holidays to support small and medium enterprises (SMEs) in generating capital and creating jobs. “People are hungry. They don’t have employment. Even government agencies are retrenching workers. How will the new tax reforms not hurt the final consumer?” he queried.
Also, the Senate Committee on Finance cautioned against viewing taxation as a primary tool for driving economic growth.
Chairman of the Committee, Senator Sani Musa, stated this yesterday while addressing journalists at the end of a plenary session. He emphasised the need for the government to prioritise production if it seeks to foster economic development.
The tax reform bills, referred to the Senate Finance Committee last Thursday, are expected to be processed and submitted for further legislative consideration within six weeks.
Speaking on the bills, Musa remarked, “Every country that wants its economy to change must, from time to time, look at those parameters to move its economy.
“And I have said it time without number on the floor that tax isn’t a tool of economic growth. What you will see that will change the face of any economy of any nation is production. It is out of that production that you will be able to make the taxes, you will be able to realise the taxes.”
The senator urged Nigerians to exercise patience as the National Assembly extensively consults on the proposed reforms.
“The issue of tax is with us, but we are doing wider consultations. It isn’t about this region or that region; for me, it is about Nigeria. What is good for me should also be good for my brother, and what is good for my brothers should also be good for me,” he said.
He reassured Nigerians that the National Assembly would make the right decisions at the appropriate time, stating, “Allow the committee, allow the National Assembly to do the needful. At the right time, we will make the right statement about this.”
This was as the Coalition of Northern Groups (CNG), a body representing youths across the 19 northern states, rejected the proposed bills, describing them as policies that would deepen poverty and economic inequality.
Speaking during a press briefing in Abuja yesterday, CNG National Coordinator, Comrade Jamilu Aliyu Charanchi, criticised the reforms as “harsh neo-liberal measures” that would exacerbate hardship for Nigerians. He accused the administration of pursuing policies that transform citizens into “modern slaves in their fatherland.”
Charanchi condemned the Federal Government for introducing reforms such as removing fuel subsidies, increasing electricity tariffs, and currency devaluation without visible benefits. According to him, these measures have expanded poverty and deprivation across the country.
The group particularly opposed the restructuring of levies funding critical institutions like the Tertiary Education Trust Fund (TETFUND), National Information Technology Development Agency (NITDA), and National Agency for Science and Engineering Infrastructure (NASENI). Charanchi argued that defunding these agencies threatens education, technology innovation, and industrialisation.
The CNG also criticised the proposed 60 per cent derivation formula for revenue collection, claiming it disproportionately favours Lagos and other states hosting corporate headquarters.
“Without publicly available data to justify these changes, the reform remains contentious,” Charanchi said.
The Coalition rejected the incremental VAT, warning it would worsen economic conditions for vulnerable households. It also expressed concern over removing VAT funding for the North East Development Commission (NEDC), which is essential for rebuilding areas devastated by insurgency.
The group called for decentralising Nigeria’s import system to include ports and borders in other regions and urged lawmakers to oppose what it termed an “unpopular policy.”
CNG commended the Northern Governors Forum and others for resisting the reforms and called for broader consultations on tax policies.
Also, a former Minister of Communications and Digital Economy, Prof Isa Ali Pantami, went further in opposition to the bills, calling on the National Assembly to halt legislative action and engage in wider consultations with relevant stakeholders.
Pantami suggested in a Facebook post yesterday, citing constitutional concerns and potential challenges in implementing the bills.
The former minister, who recently attended the 2024 World Halal Summit in Turkiye, revealed that he had dedicated time over the past 40 hours to review the proposed Nigeria Tax Administration Bill, 2024.
He acknowledged the potential of the bill to revolutionise tax collection if refined and implemented in the nation’s interest but noted critical shortcomings.
Pantami expressed concerns about ambiguities in several sections of the bill, which he argued could lead to implementation challenges or regulatory exploitation. He specifically highlighted sections 3(3), 7(6), 8(2), 23, 28, 95, 96, 97, 118, and 141, which he recommended for thorough review.
“I advise the National Assembly to suspend legislative action for now. Leadership requires intelligence and empathy, not rigidity. Wider consultations are necessary to address ambiguities and ensure that all relevant stakeholders are included,” Pantami wrote.
He further stressed the need for constitutional, tax, and business lawyers to contribute to refining the bill alongside policy researchers like himself, who may also assess the remaining three tax bills.
In the same vein, a former Minister of Defence, Dr Olu Agunloye, backed the Northern Governors’ Forum and the North in their opposition to the reform bill, stating that they are well within their rights to defend the interests of their region within the context of a federation.
Agunloye, also the National Secretary of the Social Democratic Party (SDP), emphasised that while it is legitimate for the North to advocate for their position, the region must remain steadfast in promoting equity and justice to ensure fairness for all Nigerians.
“It is indeed fair, or rather fairer, for the VAT system to be derivation-based. This way, we won’t keep wondering why VAT paid on beer in Makurdi is used to fund better bus terminals in Port Harcourt,” Agunloye said.
He argued that the current debate over tax reforms should move beyond political rhetoric, stressing that taxes and subsidies are powerful economic tools that can enhance the welfare of citizens when wielded by good leaders. “They are not meant to be used as penalties or instruments of marginalisation,” he said.
Agunloye further criticised the federal and state governments for prioritising the creation of multiple taxes and increasing tax rates instead of focusing on measures to boost production and productivity. He said, “Rather than devising ways to increase manufacturing output, governments in Nigeria are multiplying tax burdens, which is counterproductive.”
HOWEVER, the Catholic Bishop of Sokoto Diocese, Bishop Hassan Kukah, threw his weight behind the proposed tax reform bills, describing them as crucial to addressing the financial recklessness of Nigeria’s elite.
Speaking yesterday on Channels Television’s Morning Brief programme, Kukah expressed optimism about the reforms, hailing them as a step towards improved fiscal management and a remedy for the nation’s financial mismanagement.
“Nigeria is a very energetic country with people who are exceptionally gifted and always ready to excel. However, our challenge lies in the inability of states to create platforms that harness the energy, vision, and competing narratives of their citizens. This lack of structure often results in violence,” he said.
The bishop emphasised that effective reforms are vital to setting Nigeria on a path to sustainable progress.
“I am excited because this conversation offers an opportunity to address and end financial recklessness. It is ironic that Nigerians, despite living in a richly endowed country, find themselves spectators to the rascality and irresponsibility of the elite who mismanage our resources,” he added.
Kukah expressed hope that the reforms would transform the country’s fiscal narrative and ensure more efficient resource management. “I am hopeful that this marks the beginning of a long journey towards fiscal responsibility and the development of the nation we all aspire to build,” he added.
Similarly, prominent Islamic scholar, Sheikh Ahmad Abubakar Gumi, expressed support for the bills.
Speaking after reportedly reviewing the draft documents, Gumi described the reforms as beneficial to Nigeria and the economy in the long run. His endorsement adds a significant voice to the ongoing debate over the proposed changes.
While praising the overall potential of the reforms, Gumi called for a review of the VAT component to address concerns raised by stakeholders across the country.
“I believe the contentious VAT issue is the only part that needs to be reviewed; otherwise, it is a good package for all,” Gumi stated.
Meanwhile, Minister of Information and National Orientation, Mohammed Idris, commended the nationwide debate on the new tax reform bills before the National Assembly, describing the discussions as a vibrant demonstration of democracy.
In a statement yesterday, he highlighted the importance of informed engagement while urging citizens to maintain decorum in the discourse.
Idris noted that President Bola Ahmed Tinubu’s fiscal reforms are designed to empower Nigerians and strengthen local governance. Dispelling fears of potential negative impacts, he clarified that the reforms would not impoverish any state or region or weaken federal agencies. Instead, he asserted, they aim to relieve millions of hardworking Nigerians and drive sustainable growth across the country’s 774 local governments.
“The robust nationwide debate on these tax reform bills is commendable. It is inspiring to see Nigerians from all walks of life expressing their views on such critical matters. This is the essence of democracy,” Idris stated. He, however, cautioned against misinformation and divisive rhetoric, urging commentators to avoid name-calling and ethnic slurs.
The minister assured Nigerians that the government remains open to constructive feedback. According to him, President Tinubu has directed the Federal Ministry of Justice to collaborate with the National Assembly to address concerns and refine the bills. “There is nothing sinister about the process. Meaningful inputs that address grey areas are welcomed,” he added.
Idris described the reforms as the most far-reaching and beneficial fiscal measures in decades, pointing to their potential to increase revenues without additional tax burdens on citizens. He also referenced the 2023 Supreme Court ruling on financial autonomy for local governments, calling it a critical component of the reforms.
The minister emphasised that resources conserved through these measures would be reinvested in infrastructure and social services, such as healthcare, education, and digital technology, which is in line with the administration’s Renewed Hope agenda.
“These reforms will close loopholes that have drained Nigeria’s public resources for decades. They will ensure greater accountability and deliver investments that leave no one behind,” Idris concluded.
Relatedly, the Civil Society Legislative Advocacy Centre (CISLAC) called on the National Assembly to prioritise equity, inclusivity, and transparency in its discussions on the controversial bill.
In a statement signed by its Executive Secretary, Auwal Rafsanjani, CISLAC described the tax bill as a landmark opportunity to reform Nigeria’s fiscal framework. The organisation noted that the bill aims to consolidate legal provisions, improve tax administration, and enhance economic transparency but stressed the need to address critical gaps to ensure its implementation promotes inclusivity and sustainable governance.
CISLAC expressed concerns over the proposed derivation model for VAT revenue distribution, warning that it could exacerbate economic disparities among states. To mitigate this, it recommended the creation of an Equalisation Fund to assist underdeveloped states in building human capital and institutional capacity until 2030.
The organisation also proposed that VAT be collected at the point of sale rather than remitted to corporate headquarters, arguing that this would promote transparency and prevent regional revenue imbalances.
CISLAC raised the alarm over plans to double VAT rates by 2030, cautioning that such a move could fuel inflation and worsen poverty levels. Instead, it advocated maintaining the current VAT rate of 7.5 per cent until the economy stabilises while implementing measures to protect vulnerable populations from price shocks.
The organisation further recommended expanding VAT exemptions to include essential items such as cooking gas, kerosene, and electricity for consumer use. This, it said, would help cushion the regressive impact of the tax on low-income households.
Highlighting the need for transparency in administering tax incentives, CISLAC suggested strengthening the enabling laws of the Nigerian Investment Promotion Commission (NIPC) to prevent abuse. It also called for enforceable guidelines to ensure multinationals and high-turnover companies pay effective tax rates, backed by stronger compliance mechanisms to boost national revenue.
CISLAC emphasised that revenue from the proposed Development Levy should be utilised transparently to improve education and institutional capacity in underserved areas.
The organisation urged the National Assembly to work closely with civil society groups and other stakeholders to ensure the tax bill reflects the aspirations of Nigerians. It stressed the importance of fiscal policies that address socio-economic inequalities, foster trust between citizens and the government, and promote sustainable development.
