‘Tax Reform!’ Nigerians Don’t Want to Pay Tax But Wants Better Infrastructure – Akpabio

OwelekeTV (News) —  A public hearing on four proposed tax reform bills commenced at the Senate yesterday, with key figures across various sectors expressing support for the legislative measures.

The hearing aimed at addressing Nigeria’s outdated tax system and fostering economic growth through an improved revenue collection framework.

The Senate President, Godswill Akpabio, during the session highlighted the country’s low tax compliance rate, stating that less than 30% of Nigerians fulfill their tax obligations despite widespread demand for better infrastructure and services.

“This is part of the ways we can diversify our economy by making sure that we get it right. I don’t think at the moment that up to 30 per cent of Nigerians pay taxes and yet, 100 per cent of Nigerians want good roads,”

Akpabio remarked.

The proposed legislation includes the Nigeria Tax Bill (NTB) 2024, Nigeria Tax Administration Bill (NTAB) 2024, Nigeria Revenue Service (Establishment) Bill (NRSEB) 2024, and the Joint Revenue Board (Establishment) Bill (JRBEB) 2024.

These bills, submitted to the National Assembly by President Bola Ahmed Tinubu in October 2024, initially faced intense debates in the House of Representatives before being advanced for public scrutiny.

During the proceedings, Muhammad Yakubu, convener of the Arewa Think Tank, dismissed speculations that the northern region opposed the bills, stressing that the reforms serve the collective interest of all Nigerians.

Key Stakeholders in Attendance

The event attracted high-profile government officials, including Finance Minister and Coordinating Minister for the Economy Olawale Edun; Group Chief Executive Officer of the Nigerian National Petroleum Company Limited (NNPCL) Mele Kyari; Chairman of the Federal Inland Revenue Service (FIRS) Zacchaeus Adedeji; Chairman of the Presidential Committee on Fiscal Policy and Tax Reforms Taiwo Oyedele; Comptroller-General of the Nigeria Customs Service (NCS) Adewale Adeniyi; and former Nigerian Bar Association (NBA) President Yakubu Maikyau.

Also present were Minister of Trade and Investment Jumoke Oduwole; Chairman of the Revenue Mobilisation Allocation and Fiscal Commission (RMAFC) Mohammed Bello-Shehu; representatives of the Office of the Attorney-General of the Federation, the Institute of Chartered Accountants of Nigeria (ICAN), the Association of National Accountants of Nigeria (ANAN), and the Chartered Institute of Taxation of Nigeria (CITN).

Call for Overhaul of Nigeria’s Tax Structure

Akpabio urged lawmakers, stakeholders, and private sector players to work together in modernizing Nigeria’s tax system, which he described as outdated and burdensome.

He emphasized that taxation should serve as an instrument for national development rather than a tool of oppression.

“Taxation should be fair, transparent, and efficient. Every Nigerian deserves a system that works for them, not against them,”

he stated.

He also pointed out the inequities in tax revenue distribution, questioning why states that host businesses paying Value Added Tax (VAT) receive little benefit, while corporate headquarters in other regions enjoy the majority of the tax proceeds.

Akpabio called on Nigerians to move beyond online discussions and engage directly with the legislative process, assuring that the Senate is committed to enacting reforms that will positively impact the nation.

“This is more than legislation. It is about the future of our economy. Five years from now, we will look back and say, ‘Yes, thanks to these reforms, we built a stronger Nigeria,’”

he noted.

Addressing tax compliance challenges, he pointed out that many Nigerians resist paying taxes, necessitating reforms that simplify the process and ensure greater participation.

“We are not interested in making laws for ourselves. We want to leave what I will call enduring legacies for the future. And I also believe strongly that President Bola Ahmed Tinubu is quite aware that laws are meant to be obeyed and laws are meant for the good governance of the country.

“In coming up with reforms, he (Tinubu) is looking at the situation yesterday, looking at the situation today, and looking at Nigeria in the future with the way the global trend is going in terms of economic indices and changes.

“So, whenever reforms come, sometimes it might be difficult for you to comprehend, but the best place for you to come and ventilate your thoughts is right here in the National Assembly.

“This gathering is significant because the individuals in this hall understand the legislative process. This is the place where we discuss, analyze, and refine policies for the benefit of our nation.

“We are here not just to debate but to make informed decisions that will shape Nigeria’s economy. At the House of Representatives, we have been actively engaging various stakeholders, including young minds, to ensure inclusivity in governance.

“I hope these engagements continue until we have fully addressed all concerns, ensuring that our tax laws serve the best interests of the Nigerian people.

“Enhancing revenue for national development is a responsibility that concerns every Nigerian – men, women, and children alike.

“Effective taxation is not just about governance; it is about ensuring that our resources are managed efficiently to build a prosperous future.

“I think what we need to do is to try our best to even discuss and douse most of the speculations, most of the misconceptions, most of the misleading insinuations because I don’t think there is anybody interested in making a law that will not be in the interest of Nigeria, such a law will not last.

“We were very determined as people, not to just kill the baby at birth. We decided to make sure that we pass it through second reading and then, we subject it to your scrutiny and that’s what we are doing because the way it works in the National Assembly is that if a bill is submitted, and that bill does not pass through second reading, it can no longer be presented in the life of that Assembly.

“It was important that we pass the second reading and allow you to do all this and ask all the questions, discuss and at the end, we come to something agreeable for all of us.

“We would oversight government to make sure that whatever revenue comes in is well utilized.’’

Ongoing Public Engagements

The Senate’s public hearing is set to continue today, with a corresponding session scheduled in the House of Representatives tomorrow.

Finance Minister Olawale Edun reaffirmed that the proposed tax reforms are designed to modernize existing laws, expand the tax base, and create a business-friendly environment that encourages investment and job creation.

“I thank the National Assembly for its tremendous support, cooperation, collaboration and advice that have been given over the last 20 months or so to His Excellency, President Bola Ahmed Tinubu, and his administration.

“It has made for progress. It has made for the efficiency and speed of legislation in particular from which the economy has benefited.

“I must also say, Mr. President of the Senate, you have indeed enriched this session by pointing out that the aim of this tax reform and indeed, the aim of President Tinubu and the tax authorities led by the chairman of FIRS is to tax prosperity, to encourage and to engender and to provide the basis for prosperity, which then leads to higher tax revenue.

“Those who are not doing so well will be encouraged by allowing them to keep their resources to reinvest so that they can grow bigger and it is not until they are successful that they will be taxed.

“Likewise, Mr. Senate President, you’ve also pointed out the nexus, the link between government revenue and the provision of key services, economic services, infrastructure and other key drivers of the economy and payment of tax.

“The two are linked and that’s why there is a need now for this all-important reform as part of Mr. President’s Economic Agenda.”

Chairman of the Senate Finance Committee, Senator Musa Sani, echoed this sentiment, stating that the reforms aim to create a fairer, more predictable, and growth-oriented tax framework that supports businesses and enhances economic development.

NNPCL’s GCEO, Mele Kyari, emphasized that the oil and gas industry fully backs the reforms, describing them as essential for national economic progress.

“The proposed tax reform bills, to us in NNPCL, are very necessary enhancement of growth of the economy through a more efficient and effective tax collection mechanism.

“As the largest taxpayer in Nigeria, NNPCL has studied the reform bills and found the proposals to be reasonable and necessary,”

Kyari stated.

With continued deliberations in the Senate and upcoming discussions in the House of Representatives, stakeholders remain engaged in shaping the future of Nigeria’s taxation system.