The National Economic Council (NEC) has advised President Bola Tinubu to withdraw the Tax Reforms Bill currently before the National Assembly in view of the controversies surrounding some provisions of the proposed fiscal legislation.
The NEC gave the advice as one of the recommendations at its 145th meeting in Abuja.
Speaking on the council’s position on the Bill, Oyo State Governor, Seyi Makinde, explained that the NEC hinged its decision on the need for sufficient alignment among stakeholders on the proposed tax reforms.
The governor specifically cited the raging controversies on the Bill in the public ostensibly due to misinformation about the draft legislation as making it expedient for the Executive to expose the draft provisions for wider consultations in order to disabuse the minds of those currently opposing the bill.
Noting that the Tax Reforms Bill is desirable given the country’s under-performance in major revenue sources, Makinde disclosed that the NEC also considered the Presidential Committee on Fiscal Policy and Tax Reforms presentation of a report focusing on fair taxation, responsible borrowing, and sustainable spending as a strong basis for the fiscal reforms
In his remarks, Borno State Governor, Prof. Umaru Zulum, also confirmed that the council advised the Executive to withdraw the bill for wider consultation on the provisions in order to ensure that all parties’ interests are well taken care of in the provisions of the Bill
The Tax Reforms Bill, which was based on the recommendations of the Presidential Committee on Fiscal Policy and Tax Reforms, chaired by Mr. Taiwo Oyedele, had been critically appraised the Federal Executive Council (FEC) before President Tinubu forwarded it to the National Assembly for passage.
Specifically, the Bill is aimed at enhancing Nigeria’s tax administration efficiency and eliminate all abuses with a view to sustainably boosting the nation’s revenue generation for national development.
It would be recalled that the Northern governors had on Monday expressed their opposition to the Tax Reforms Bill, particularly the VAT amendment Bill, citing potential harm of the passage to regional interests.
The new tax legislation seeks to provide Value Added Tax (VAT) exemptions to oil and gas exports, crude petroleum oil and feed gas for all processed gas, as well as goods purchased for use in humanitarian donor-funded projects.
It also seeks to exempt baby products, locally manufactured sanitary towels, pads or tampons, military hardware, arms, ammunitions and locally manufactured uniforms supplied to armed forces, para-military and other security agencies of a Nigerian government from payment of VAT.
Apparently uncomfortable with the provisions of the Bill, the governors of 19 states under the aegis of Northern States Governors Forum (NSGF), rejected the proposed tax amendment bill.
In the communique issued at the end of a joint meeting they held with Northern Traditional Rulers Council at Government House, Kaduna, the governors urged the National Assembly to “oppose any bill that can jeopardise the well-being of our people”.
Governor of Gombe State/Chairman of NSGF, Mohammadu Yahaya, who read the group’s communique, called for equity and fairness in the implementation of all national policies and programmes to ensure that no geopolitical zone was short-changed or marginalised.
Similarly, the governors canvassed the exemption of from the VAT bill shared passenger road-transport service; and purchase, hire, rental or lease of tractors, ploughs and other equipment used for agricultural purposes, provided that the person engaged in agricultural business shall first pay the VAT and request a refund from the tax authority.
