President Bola Tinubu has announced that the proposed legislation would remain with the National Assembly for review, despite recommendations from the National Economic Council (NEC) to retract them for additional consultation.
This development was made public in a statement by Bayo Onanuga, the President’s Special Adviser on Information and Strategy, who clarified that Tinubu believes the legislative process is the appropriate channel to allow for feedback and potential revisions.
According to the statement, “President Bola Tinubu received the NEC’s recommendation that the tax reform bills already submitted to the National Assembly be withdrawn for further consultation.
However, he believes that the legislative process, which has already begun, provides an opportunity for inputs and necessary changes without the need to withdraw the bills.”
Tinubu expressed appreciation for the NEC’s input, particularly acknowledging Vice President Kashim Shettima and the governors of the 36 states for their counsel.
He underscored that he remains open to consultations with key stakeholders to address any concerns surrounding the proposed reforms.
The tax reform bills are part of a broader strategy initiated by Tinubu’s administration to revamp Nigeria’s tax and fiscal policies.
In August, Tinubu established the Presidential Committee on Tax and Fiscal Policy Reform, aiming to make Nigeria’s economy more productive and create a favorable business environment.
“His objective is to reposition the economy for better productivity and efficiency, making the operating environment more conducive for investment and businesses,” Onanuga stated, adding that this goal “remains more critical even today than ever before.”
NEC, led by Vice President Shettima, had voiced strong reservations over the tax reform proposals during a meeting on Thursday at the Presidential Villa in Abuja.
The Council cited inadequate consultation and coordination among stakeholders as primary reasons for urging a retraction.
Governor Seyi Makinde of Oyo State, who briefed the media on NEC’s stance, stressed the importance of wider engagement with stakeholders, including state governors, to ensure the proposed tax laws benefit all Nigerians.
“NEC noted the need for sufficient alignment between and amongst stakeholders for the proposed reforms,” he said.
NEC’s concerns extend to areas such as fair taxation, responsible borrowing, and sustainable government spending. Makinde highlighted that Nigeria is lagging on multiple revenue indicators, including the tax-to-GDP ratio, which necessitates reform.
However, the Council believes a re-evaluation of the tax reform approach is essential to avoid miscommunication and potential backlash.
Adding to the controversy, the Northern Governors’ Forum recently rejected aspects of the reform, notably the value-added tax (VAT) provisions, which they argue disadvantage Northern states.
Meeting in Kaduna, the governors cited unfairness in the proposed VAT-sharing framework and called for equitable treatment across regions.
Governor Inuwa Yahaya of Gombe, chair of the Northern Governors’ Forum, declared that the forum’s members were “not opposed to policies aimed at fostering national growth.”
However, he stressed the need for fairness, arguing that the current VAT structure—where taxes are remitted based on a company’s headquarters location rather than where goods and services are consumed—does not favor Northern states.
“We oppose any bill that could jeopardize the well-being of our people,” Yahaya said, urging Northern lawmakers to reject the bills if necessary.
Governors in attendance, including Uba Sani of Kaduna and Babagana Zulum of Borno, supported the call, underscoring the need for an inclusive approach to the country’s tax policy.
Despite the NEC’s objections and the Northern Governors’ resistance, Tinubu appears resolute in moving forward with the legislative process.
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