ABUJA: In a statement released on Wednesday, Temitope Ajayi, the Senior Special Assistant to the Presidency on Media and Publicity, shed more light on the controversial Tax Reform Bills, addressing concerns raised about the legislation.
The statement followed President Bola Tinubu’s directive on Tuesday, where he instructed the National Assembly and the Ministry of Justice to work collaboratively to address the concerns surrounding the Tax Reform Bills. The move has sparked widespread criticism, with the most vocal opposition coming from governors in the northern region. Critics argue that the bills are detrimental to the region and would worsen the economic situation for many Nigerians.
To address these concerns, President Tinubu directed the Ministry of Justice to engage with the National Assembly to refine the bills, ensuring that any legitimate issues are thoroughly addressed before passage. Minister of Information and National Orientation, Mohammed Idris, reiterated this in a statement on Tuesday, affirming that the government is open to meaningful input and willing to make necessary adjustments in line with legislative procedures.
Ajayi further explained the potential benefits of the Tax Reform Bills, especially for state governments. He acknowledged that change is often met with resistance, particularly when it challenges the status quo. However, he urged stakeholders to consider the broader benefits of these reforms.
Reda also:
- Governor Zulum Explains Why Northern Governors Urged Tinubu to Pause Tax Reform Bills
- House Deputy Spokesman Backs Tinubu’s Tax Reforms, Urges Support for Nationwide Economic Growth
- Borno Governor Zulum Clarifies: Opposition to Tax Bills Not Opposition to Tinubu
- North Slam New Tax Bill: Warn of Dire Economic Consequences
- Tax Reform Bill Not Against The North, Aims to Benefit All States Equally-Presidency
- Proposed New Bill: No Bank Accounts Opening Without Tax ID-CBN He pointed out that the strongest opposition to the bills has come primarily from northern governors, including Borno State Governor, Professor Babagana Zulum. Ajayi emphasized that if these governors had fully analyzed the four executive bills, they would understand the transformative potential they offer. He stressed that the bills aim to strengthen both federal and state finances, making them more resilient and prosperous.
Ajayi also highlighted key benefits of the Tax Bills that will directly support state governments:
- The federal government will cede 5% of its current 15% share of VAT revenue to states.
- Income from the Electronic Money Transfer levy will be transferred exclusively to states as part of stamp duties.
- The bills propose the repeal of outdated stamp duty laws, introducing a simplified framework to boost state revenue.
- States will have the right to tax Limited Liability Partnerships.
- The proposed reforms will allow state governments to enjoy tax exemptions on their bonds, putting them on equal footing with federal government bonds.
- The new VAT distribution model will be more equitable, leading to higher VAT income for states.
- Integrated tax administration will provide states with tax intelligence and enhance collaboration, including expanding the Tax Appeal Tribunal to cover state tax disputes.
- The Accountant General of the Federation will be empowered to deduct unremitted taxes from federal government or MDA employees and remit them to the relevant state.
- The framework will grant autonomy to state internal revenue services and strengthen the Joint Revenue Board, fostering fiscal federalism.
- The introduction of a legal framework for the taxation of lottery and gaming activities, along with a withholding tax, will benefit states.
Ajayi concluded by emphasizing that the Tax Bills are not harmful to the states. Rather, they streamline the tax system, stimulate economic growth, and provide states with the tools to become economic powerhouses. He challenged governors to focus on investing in human resources and infrastructure that will support businesses and foster socio-economic development within their states.
