After about four hours debate by House of Representatives’ members, President Tinubu’s Tax reform bills passed second reading
After long deliberations and consultations, the long awaited President Bola Tinubu’s tax reform bills has received the green light of the the House of Representatives as the four bills passed second reading on Wednesday.
On 3 October 2024, President Tinubu transmitted the following tax bills to the National Assembly: Nigerian Tax Bill; Nigeria Tax Administration Bill; Joint Revenue Board Bill; and Nigeria Revenue Service Bill.
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These bills aim to simplify Nigeria’s tax system, reduce multi-layered taxation, expand the tax base, enhance compliance, and generate sustainable revenue for national development. They also seek to protect small businesses and address tax evasion.
The key provisions of the bills include among others :
- To exempt small businesses with an annual turnover of ₦50 million or less from income tax.
- Reduce company income tax rates from 30 to 25 percent over two years.
- Exempt individuals earning ₦800,000 annually or less from income tax.
- Implement 0 percent VAT on essential items like food and healthcare.
During Wednesday’s plenary, several lawmakers took turns to expresse strong support for the bills. However, Rep. Sada Soli (APC Katsina) raised concerns that certain provisions might conflict with the 1999 Constitution.
Soli emphasized the need for a clear definition of derivation to prevent any ambiguity. He expressed confidence that the committee tasked with reviewing the bill would resolve potential issues before its passage.
Supporting Rep. Soli’s position, Rep Abubakar Fulata (APC Jigawa) said three of this bills are without interpretation clause. Adding that a bill without interpretation clauses is a blind bill and is subject to misinterpretation.
Rep. Kwamoti Laori (PDP Adamawa), cushioned that session 52 of the one of the bills be checked as it gives the president unlimited powers, saying “we need to look into it so that it’s not abused.”
Additionally, other lawmakers highlighted the 40 acts the bill seeks to amend, urging that they be presented before Parliament for review. They also called for the resolution of the multiple taxation clause related to property purchases, which mandates both buyer and seller to pay taxes.
In his contribution also, the Minority Leader Rep. Kingsley Chinda (PDP Rivers), commended the good spirit backing the bill. However, he emphasized that the letters of the bills be checked to align with the demands of Nigerians.
Having exhaustively debated the said bills, the Speaker of the House Rep. Tajudeen Abbas, referred the consolidated bills to the House committee on Finance for further legislative actions.
Parliament Reports recalls that the tax bills had sparked widespread controversy and criticisms and stiff opposition from many Nigerians, including northern governors and opposition politicians who demanded their withdrawal from the National Assembly.
However the tides began to turn as several caucuses began to endorses the bills, among them, the governors said they support the modernization of the archaic tax laws.
