The prospects of the tax reform proposed by the President Bola Ahmed Tinubu’s administration were brought to the fore at the weekend by the panel.
Chairman, Presidential Fiscal Policy and Tax Reform Committee, Mr. Taiwo Oyedele, whose recommendations gave birth to the four bills before the National Assembly, gave an insight into the advantages of the proposals.
President Tinubu last month forwarded the Executive Tax Reform Bills for legislative consideration.
However, governors and traditional rulers from the North requested for its withdrawal, claiming that a portion of it is not in their region’s interest.
The National Economic Council (NEC) supported the North’s position asking for wider consultation.
But the president rejected the advice, saying the National Assembly is the place for those who have misgivings to ventilate their feelings.
At the weekend, Oyedele said Nigeria’s tax laws are obsolete and irrelevant to modern governance. He said some of the laws dated back to 1939.
Oyedele insisted that if passed, only the rich will pay more while the consolidation would create ease of payment, adding that more money will be made available to all tiers of government.
He clarified that the VAT law resides within the Nigerian tax bill, while the adjustments to derivation are contained in the tax administration bill.
“Somebody picked one leg of it, didn’t find the second one, and then concluded that this was going to be against the law. This is to benefit everybody, he explained. .”
According to him, the VAT reform, for instance, aims to shift the focus of tax revenue to reflect economic activities occurring across all states, rather than centralising it around states where companies are headquartered.
He explained that under the new model, the allocation of VAT will be based on where goods and services are consumed, rather than solely where they are produced.
“Rather than saying that because the company producing the beverages is headquartered in Lagos, that’s where we derive all the VAT revenue from Nigeria, we’ll say, where did you send them to? The ones you sent to Ekiti, to Zamfara, to Kebbi, to Abia—let them take credit for their economic activities,” Oyedele said.
“Everyone should be excited about that apart from Lagos State. We believe it’s a fairer approach,” he added.
