KEY POINTS

• Tax Reform Bills have been resolved and are set to pass Senate.
• The bills are to modernise Nigeria’s tax legislation and enhance revenue gathering.
• Nigerians will get a chance to contribute before final passage in public hearings.

Tax Reform Bills before the Senate and the House of Representatives have made substantial progress in their consultations with federal agencies and stakeholders and are on track for approval.

According to Senator Abba Moro, Minority Leader and the Chair of Senate Ad-hoc Committee on Tax Reforms, the public hearings on the bills will take place soon and they’ll later go through the third reading and become law.

After a meeting with Mohammed Bello Shehu, RMAFC Chairman; Federal Inland Revenue Service (FIRS) Chairman Zacch Adedeji; Revenue Mobilization Allocation and Fiscal Commission (RMAFC) Chairman; Presidential Fiscal Policy and Tax Reforms Committee (PFFTRC) Chair Taiwo Oyedele; Attorney General of the Federation Lateef Fagbemi (SAN); Moro spoke.

Tax reform clears grey areas

Senator Moro stressed that there were compromises over what have been deemed contentious provisions in proposed reforms. According to him, “We must synthesize the whole process to be sure about delivering a law that will serve all the Nigerians.”

FIRS Chairman Zacch Adedeji also confirmed that all the perceived grey areas were clarified at the meeting. “All of our problems we found, we clarified and we solved them.” Adedeji said the positive engagement based on which the bills would pass into law very soon.

Key highlights of tax reform bills

On 3 October 2024, four tax reform bills were transmitted to the National Assembly by President Bola Tinubu at the recommendation of the Presidential Committee on Fiscal and Tax Reforms, headed by Taiwo Oyedele. The bills seek to update Nigeria’s tax structure and to rectify inefficiencies.

The proposed bills include:
1. Nigeria Tax Bill 2024: Sets a tax framework for the whole country.
2. Tax Administration Bill: It offers a legal basis for taxes management and disputes reduction.
3. Nigeria Revenue Service Establishment Bill: It replaces the Federal Inland Revenue Service Act and provides a new revenue authority.                                                         4. Joint Revenue Board Establishment Bill: It establishes a tax tribunal and an ombudsman to settle disputes, and improve transparency.

These reforms are aimed to increase administrative efficiency of tax administration, clarity of the tax laws and improve revenue collection.

Legislative milestones and steps beyond

Following the time when President Tinubu wants Legislative processes to continue, the Tax Reform Bills passed second reading in the Senate on November 28, 2024. Before final passage, Nigerians will have an opportunity at public hearings to make input.

Unanimous agreement by lawmakers, government agencies and stakeholders on the bills means they will quickly pass, marking a huge step toward modernizing Nigeria’s tax system.