Fresh from its conduct of public hearings on the Tax Reform Bills, the National Assembly now says the planned legislation will remove all the fears entertained about them in some parts of the country, and meet the aspirations of the different geo-political zones.

The Senate is already planning a three-day retreat to consider the inputs made during the two-day public hearings held last week.

Chairman of the Senate Committee on Finance, Senator Sani Musa, told The Nation that the National Assembly would leave no stone unturned in producing tax reform bills that can stand the test of time.

“We are going to work assiduously and we are going to consider every submission, every memorandum that has been given,” he said.

“The verbatim presentation that people have done, we have it on record.

“We are going to review everything. After this, we are going to go for a three-day retreat, and during the retreat, we are going to consult with experts.

“We are consulting also with the Office of the Attorney General of the Federation so that we see how we can present a law or an Act that is workable, that would not conflict with the Constitution of the Federal Republic of Nigeria.

“We are taking the advice of everyone that had made the presentation. We are going to consider everything on its own merit.

“We are not particularly looking at which organisation or which entity presents, but what is going to be acceptable to all Nigerians, what is going to be acceptable to all regions of this country, because what we are trying to do is to present a law that is workable.”

He also said the bills, when they become operational, would aid the realization of President Bola Tinubu’s planned $1 trillion economy for the country.

His words: “And when you look at advanced economies, Mr. President has said that he wants to see Nigeria having a $1 trillion economy, and this is the beginning of it.

“For us to do it, we must do it in a way that is not only during the time of Mr. President.

“Mr. President is only going to stay for likely eight years, and after eight years, there will be another government.

“So, we want a law that will outlive anybody that is there, even us that we are making the law, at the end of the day, we are going to be the ones also that will have to follow what we have led.

“So I think it’s not about who presents, it’s about what Nigerians will see as a true reflection of what it should be.”

Musa’s counterpart in the House of Representatives, Abiodun Faleke, described the public hearings as a veritable platform for stakeholders to make their inputs for a balanced legislation.

Faleke said: “The public have responded to us. We will now look at every detail to propose a bill; a bill that will now be passed into law, considered by the House, if the House agrees with all our suggestions.

“When we finish and we lay a report and it is discussed on the floor or debated and passed, we will compare it with that of the Senate. Any areas of differences, we will harmonise.”

Faleke said his Committee would scrutinise all the presentations by Nigerians with a view to bringing out the best in the overall all interest of Nigerians.

Executive Director of the Peering Advocacy and Advancement Centre in Africa, Ezenwa Nwagwu, emphasised that the proposed tax reforms must be pursued through a non-partisan approach to achieve their intended objectives.

Nwagwu stated that a stable and well-structured tax system would be of greater benefit to all Nigerians, regardless of political affiliations.

Expressing support for the proposed reforms, he described them as a step towards a fairer and more efficient tax system that would enhance revenue generation without placing undue burdens on businesses and individuals.

Addressing the proposed changes to the VAT sharing formula, he acknowledged concerns raised by some stakeholders regarding the derivation principle.

While this principle is expected to benefit states with higher economic activity, he noted that it might disadvantage less industrialised regions.

However, he argued that the tax reforms would incentivise other regions to boost economic activity, create jobs and generate more VAT revenue.

He also called for post-reform monitoring mechanisms to track progress, address challenges and ensure continuous improvement.

Speaking further, Nwagwu urged the government to ensure transparency and public accountability in implementing the reforms to build trust and encourage compliance among taxpayers.

The Tax Reform Bills, comprising the Nigeria Tax Bill, Nigeria Revenue Service (Establishment) Bill, Nigeria Tax Administration Bill and Joint Revenue Board (Establishment) Bill, were initiated by President Tinubu and transmitted to the National Assembly on October 3, 2024 for its consideration.

The Nigeria Tax Bill (the Bill) consolidates the legal frameworks relating to taxation within the purview of the federal government, which were previously administered under separate tax laws, into a single piece of legislation.

It proposes to repeal the Companies Income Tax Act, Personal Income Tax Act, Capital Gains Tax Act, Petroleum Profits Tax Act, Value Added Tax Act, and six other tax laws, as well as amend 13 additional tax laws.

Some parts of the bills, especially those relating to the Value Added Tax (VAT) and the formula for sharing it by the three tiers of government, had generated much controversy at the level of the 36 state governors and regional groups.

However, the contentious issues were later resolved with the governors proposing amendments.

The Nigeria Governors’ Forum (NGF) at a January meeting in Abuja with the Chairman of the Presidential Fiscal Policy and Tax Reforms Committee, Taiwo Oyedele, threw its weight behind the bills.

The forum proposed an equitable sharing formula for Value-Added Tax as follows: 50% based on equality, 30% based on derivation and 20% based on population.

The NGF agreed that “there should be no increase in the VAT rate or reduction in Corporate Income Tax (CIT) at this time to maintain economic stability.”

Besides, the governors ruled out a terminal clause for the Tertiary Education Trust Fund, National Agency for Science and Engineering Infrastructure and National Information Technology Development Agency in the sharing of development levies in the bills, and supported the continuation of the legislative process at the National Assembly that will culminate in the eventual passage of the tax reform bills.

They acknowledged the importance of modernising the tax system to enhance fiscal stability and align with global best practices.