Akpabio urged all stakeholders, government agencies, businesses, and civil society to actively participate in shaping a tax system that works for all Nigerians.
The senate committee on finance has commenced a two-day public hearing on four critical tax reform bills aimed at overhauling Nigeria’s revenue administration framework.
These bills are: the Nigeria Tax Administration Bill, the Nigeria Revenue Service (Establishment) Bill, the Joint Revenue Board Bill, and the Nigeria Tax Bill.
The hearing serves as a platform for engagement between lawmakers, government officials, and key stakeholders to deliberate on the proposed legislative reforms. Attendees include the Minister of Finance and Coordinating Minister of the Economy, Wale Edun; the Chairman of the Federal Inland Revenue Service (FIRS), Zacch Adedeji; the Group CEO of the Nigerian National Petroleum Company Limited (NNPCL), Mele Kyari; as well as members of the Federal Executive Council, heads of relevant agencies, and the Comptroller General of Customs, Adewale Adeniyi, among others.
Legislative process and stakeholder engagement
The Chairman of the Senate Committee on Finance, Sen. Sani Musa, emphasised that the hearing follows extensive consultations with stakeholders, including a closed-door meeting on February 19, 2025. He assured the public that the process will be transparent, inclusive, and thorough, ensuring that all concerns are addressed to support Nigeria’s economic growth.
These tax reform bills were initially submitted to the National Assembly by President Bola Tinubu on October 3, 2024. While they have faced public scrutiny, they successfully passed their second reading in the Senate on November 28, 2024. The bills are expected to be enacted by the end of the first quarter of 2025, with implementation slated for July 2025.
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Akpabio calls for collective action on tax reforms
In his opening remark, the President of the Senate, Godswill Akpabio underscored the significance of modernising Nigeria’s tax system to enhance economic growth and fiscal sustainability.
“Today, we gather at a pivotal moment, one that calls us to reform, modernize, and optimize our tax system. This is not just a task; it is a profound responsibility we must embrace with courage, wisdom, and a steadfast commitment to the Nigerian people. As we look to the future, we must remember that a nation that fails to adapt its revenue system to the realities of our time risks stagnation and decline.”
He likened the nation’s tax evolution to an African proverb saying, “A bird that does not leave its nest will never know the richness of the forest.”
This, he explained, symbolises Nigeria’s move away from outdated tax practices towards a system that is transparent, efficient, and conducive to business growth.
Akpabio emphasised that the goal of these reforms transcends the mere enactment of laws. Instead, the focus is on building a tax system that fosters confidence, economic development, and sustainable revenue generation. He urged all stakeholders, government agencies, businesses, and civil society to actively participate in shaping a tax system that works for all Nigerians.
He reaffirmed the commitment of the 10th National Assembly to enacting legislative reforms that will strengthen Nigeria’s economic foundation, empower businesses, and enhance governmental accountability.
He said, “Let us seize this moment, not just for ourselves, but for future generations, to lay the foundation for a stronger, more resilient, and prosperous Nigeria.”
Key objectives of the bill
1. Consolidation and simplification: The bill seeks to unify multiple tax laws into a single act, streamlining compliance for both individuals and businesses, thereby reducing administrative burdens.
2. Revenue optimisation: By broadening the tax base to encompass modern economic activities, the bill aims to enhance the government’s revenue-generating capacity
3. Equity and fairness: The legislation introduces a progressive tax structure, ensuring that tax liabilities are distributed more equitably across different income levels.
Notable provisions
• Value-Added Tax (VAT) Adjustments: A phased increase in VAT is proposed, starting at 10% in 2025, rising to 12.5% between 2026 and 2029, and reaching 15% by 2030. Essential goods such as food and medicine are exempted to mitigate the impact on low-income households.
• Corporate Income Tax (CIT) Revisions: The bill proposes an increase in the CIT rate to 27.5% for the 2025 assessment year, with a subsequent reduction to 25% from 2026 onwards.
• Digital Economy Taxation: Recognizing the growth of digital transactions, the bill includes provisions to tax digital assets and online services, ensuring they contribute fairly to the national revenue.
• Excise Duties: New excise duties are introduced for specific sectors, including a 5% duty on lottery and gaming revenues and telecommunications services, targeting industries with significant consumer demand.
