The Nigerian Senate has successfully passed the Tax Reform Bills proposed by President Bola Tinubu. The bills, presented by Senate Leader Opeyemi Bamidele, were approved after a closed-door session that lasted for more than an hour, during which senators deliberated on the specifics of the proposed reforms.
The Tax Reform Bills are part of the government’s broader plan to overhaul Nigeria’s tax system, aiming to increase revenue generation, simplify tax compliance processes, and support the growth of businesses. Comprising 43 clauses and six parts, the bills are designed with several key provisions, including measures to protect small businesses and exempt the impoverished from tax obligations. One of the central proposals in the bills is a reduction in corporate tax from 30 percent to 25 percent, a move intended to incentivize business growth and attract investments.
Despite the passage, the bills were not without controversy. Senator Ali Ndume voiced strong opposition, criticizing the insufficient consultations with key stakeholders and raising concerns about certain provisions, such as the handling of the Value Added Tax (VAT) and the issue of derivation. Ndume argued that some of the provisions in the bill would require amendments to the Constitution before they could be implemented. He suggested that the bill should be withdrawn, reworked, and resubmitted after receiving the necessary buy-in from the Governors, the National Executive Council (NEC), and traditional rulers.
However, the bill found strong support among other senators, including Senator Seriake Dickson and the Chairman of the Senate Committee on Finance, who championed the proposed reforms. Senate President Godswill Akpabio ruled in favor of the lawmakers supporting the bills, allowing the passage to proceed.
In a bid to address the concerns raised and ensure a thorough examination of the proposed reforms, the Senate has directed its Finance Committee to hold a public hearing. The hearing will provide an opportunity for various stakeholders, including the Governors’ Forum, the National Economic Council (NEC), the Northern Elders’ Forum (NEF), and other opposition groups, to share their perspectives and offer feedback on the bill. The Finance Committee has been tasked with reporting back to the Senate within six weeks, ensuring that all concerns are considered before the final implementation of the tax reforms.
The passage of the Tax Reform Bills marks a significant step in the government’s efforts to modernize Nigeria’s tax system. However, the ongoing discussions and consultations will play a crucial role in shaping the final outcome of the reforms, ensuring they align with the needs and interests of all parties involved.
