The debate over President Bola Tinubu’s Tax Reform Bills intensifies as governors reportedly threaten federal lawmakers with withdrawal of support for their 2027 reelection bids if they endorse the proposals.
Speaking in Abuja, Deputy Spokesman of the House of Representatives, Philip Agbese, disclosed that some governors are pressuring legislators to oppose the bills, despite their focus on modernizing Nigeria’s tax system to boost economic growth.
Tinubu’s Tax Reform Proposals
The four bills—submitted on September 3—aim to overhaul Nigeria’s tax framework:
- Nigeria Tax Bill 2024: Establishes a comprehensive fiscal framework.
- Tax Administration Bill: Creates a unified legal structure for taxation, reducing disputes.
- Nigeria Revenue Service Establishment Bill: Replaces the Federal Inland Revenue Service Act.
- Joint Revenue Board Establishment Bill: Introduces a tax tribunal and ombudsman.
Governors Demand Withdrawal
The 36 state governors have called for the withdrawal of the bills, citing inadequate consultation. However, President Tinubu has stood firm, urging that any contentious clauses be addressed during debates in the National Assembly.
Agbese criticized the governors’ tactics, asserting that lawmakers are committed to supporting initiatives that align with national interests.
“We were elected by our constituents, not governors. These bills aim to revamp the economy, and we will support them wholeheartedly,” Agbese stated.
Economic Implications of Tax Reforms
At an interactive session organized by the House of Representatives, Taiwo Oyedele, Chairman of the Presidential Committee on Fiscal and Tax Reforms, clarified that the bills are designed to ensure efficiency and allocate more revenue to states where goods and services are consumed.
Under the current VAT Act, revenue is distributed as follows:
- 15% to the federal government
- 50% to states and the FCT
- 35% to local governments
Oyedele emphasized the reforms aim to expand Nigeria’s tax base without bias against any region.
Speaker Tajudeen Abbas: Scrutiny in National Interest
House Speaker Tajudeen Abbas pledged that the tax reform bills would be carefully examined to ensure fairness and transparency.
“Taxes are the backbone of public revenue, essential for delivering education, healthcare, infrastructure, and security,” Abbas remarked, lamenting Nigeria’s low tax-to-GDP ratio of 6%, compared to the global benchmark of 15%.
He explained that the proposed reforms aim to:
- Diversify Nigeria’s revenue base.
- Reduce reliance on debt financing.
- Promote equity and foster an environment for investment and innovation.
Building Consensus for Sustainable Growth
The House leadership has distributed copies of the bills to members for detailed review and is engaging tax experts, including Oyedele, to address contentious issues before the resumption of plenary.
Deputy Speaker Benjamin Kalu assured Nigerians of a balanced tax system that promotes equity and economic growth, stating:
“Tax policy is more than a fiscal tool—it’s a catalyst for inclusive prosperity and national progress.”
Next Steps
With consultations ongoing, the House is expected to amend and pass the bills, aiming to modernize Nigeria’s tax system, improve compliance, and reduce reliance on debt financing, while addressing public concerns raised by the governors.