The Presidential Committee on Fiscal Policy and Tax Reforms, spearheaded by President Bola Tinubu, is engaging with state governors with the aim of reaching an agreement for the suspension of certain low-revenue taxes.
This initiative is expected to result in the discontinuation of what the committee terms “nuisance taxes” imposed by states and local government authorities across Nigeria.
Chairman of the committee, Taiwo Oyedele, discussed this development during an interview on Channels Television, highlighting that these low-revenue taxes were not contributing significantly to the state’s financial resources. The term “nuisance taxes” typically refers to fees imposed as a percentage of the selling price of goods or services.
Oyedele expressed concern about the negative impact of certain taxes, particularly those affecting the transport of goods from the North to the South and vice versa, which often disproportionately affect the poor. He emphasized that these taxes create problems without yielding substantial revenue for the states.
The committee is actively engaging with state governors, and in some instances, has established small committees to facilitate discussions with their teams. Oyedele indicated that once agreements are reached, the implementation of the tax suspensions will commence promptly.
In addition to addressing nuisance taxes, the committee is also tackling challenges related to the collection of certain taxes, with concerns raised about returns not reaching government coffers. Oyedele shared updates on the progress of the committee, stating that the Emergency Economic Intervention Bill, a crucial element of the tax reform strategy, is expected to be submitted to the Federal Executive Council (FEC) for approval. Following FEC endorsement, the bill will proceed to the National Assembly for consideration.
The tax reform bill, which aims to address multiple taxations and improve the overall tax system, is anticipated to pass through the National Assembly and receive presidential assent by the end of the first quarter. The committee, inaugurated in August 2023, has a mandate to facilitate tax reforms that enhance economic growth and development.
Meanwhile, President Bola Tinubu, during the third South Summit of the Group of 77 and China, advocated for a swift review of global taxation to address imbalances in the international tax regime. Represented by the Minister of Budget and Economic Planning, Abubakar Bagudu, Tinubu emphasized Nigeria’s commitment to multilateralism and called for a more equitable and inclusive global tax system. He expressed appreciation for the support received for a global tax review initiative, describing it as a step towards rectifying inequities and fostering a just economic order.
