Chairman of the Presidential Committee on Fiscal Policy and Tax Reforms, Taiwo Oyedele, has expressed concern over Nigeria’s tax system, stating that the federal government has failed to deliver tangible benefits despite collecting over 60 taxes and levies nationwide.
Speaking during the Senate’s plenary on Wednesday, Oyedele criticized the existing fiscal structure, describing it as counterproductive.
He noted, “The fiscal system we have today inhibits growth as more than 60 taxes and levies are collected from across the country, but nothing to show for it.”
He highlighted the plight of Nigerian businesses forced to pay taxes even when operating at a loss, emphasizing the need for urgent reforms.
“We do not want to tax capital or poverty but investment. We are beginning to lose our tax base to other countries. This is why it is urgent to reform the tax system,” he added.
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Senate Suspends Rules Amid Tensions
Oyedele’s remarks followed the Senate’s heated session, during which lawmakers protested the entry of Federal Inland Revenue Service (FIRS) Chair Zacch Adedeji and his team of consultants into the Upper Chamber. The Senate had to suspend its rules to admit Adedeji and the consultants to explain aspects of the controversial Tax Reform Bill.
Despite tensions, the lawmakers refrained from immediate questions and resolved to invite Oyedele’s team for further clarifications at a later date.
Opposition to the Tax Reform Bill
President Bola Tinubu submitted the Tax Reform Bill to the National Assembly in October, framing it as a necessary measure to align with ongoing fiscal reforms and improve tax compliance efficiency. However, the bill has faced significant pushback, especially from northern governors and other stakeholders.
The 19 Northern governors, along with the National Economic Council (NEC), voiced their objections to the bill, particularly its proposal to amend Value Added Tax (VAT) distribution to a derivation-based model. They argued that such changes could disproportionately affect their states’ revenue.
The NEC recommended withdrawing the bill for further consultation, but President Tinubu rejected the suggestion. According to a statement from presidential spokesman Bayo Onanuga, the President emphasized that the legislative process offers ample opportunity for modifications and stakeholder input.
President Tinubu Defends Reforms
While defending the Tax Reform Bill, Tinubu stressed its objective to reposition Nigeria’s economy and foster a more conducive environment for businesses. The legislative process, which has already begun, provides an opportunity for inputs and necessary changes without withdrawing the bills from the National Assembly,” Onanuga said in a statement.
The President reaffirmed his commitment to broadening consultations and engaging with stakeholders to address concerns about the bill while maintaining his focus on long-term economic productivity.
The Tax Reform Bill continues to stir debate, with its potential impact on Nigeria’s fiscal landscape remaining a contentious issue in legislative and public discourse.
