President Bola Tinubu has approved the establishment of a Presidential Committee on Fiscal Policy and Tax Reforms of which the Fiscal Policy Partner and Africa Tax Leader at PriceWaterhouseCoopers (PwC), Mr. Taiwo Oyedele, will serve as Chairman.
The committee will also fiscal experts from both the private and public sectors as members and have responsibility for the various aspects of tax law reform, fiscal policy design and coordination, harmonization of taxes, and revenue administration.
Special Adviser to the President on Revenue, Mr. Adelabu Adedeji, who announced the setting up of the committee explained that the initiative was undertaken by the President based on his recognition of the critical roles a sound fiscal policy environment and an effective taxation system play in governance and the economy.
He stated: ”Nigeria ranks very low on the global ease of paying taxes while the country’s Tax to GDP ratio is one of the lowest in the world and well below the African average.
”This has led to an over-reliance on borrowing to finance public spending which in turn limits the fiscal space as debt service costs consume a greater portion of government revenue, annually resulting in a vicious cycle of inadequate funding for socio-economic development.
”While some incremental progress has been recorded over the years, the outcomes have not been transformative enough to change the narrative”, Adedeji added.
He outlined the key challenges in Nigeria’s tax system to include multiple taxes and revenue collection agencies, fragmented and complex tax system, low tax morale, high prevalence of tax evasion, high cost of revenue administration, lack of coordination between fiscal and economic policies, and poor accountability in the utilization of tax revenue.
Specifically, the Special Adviser stated that Tinubu took the step as part of his administration’s moves to addressing these challenges and bringing about transformative reforms in fiscal policy and taxation
According to him, the committee’s primary objective is to enhance revenue collection efficiency, ensure transparent reporting, and promote the effective utilization of tax and other revenues to boost citizens’ tax morale, foster a healthy tax culture, and drive voluntary compliance.
Adedeji further stated that these efforts would not only improve Nigeria’s revenue profile but also create a more conducive and internationally-competitive business environment.
He clarified: “Our aim is to transform the tax system to support sustainable development and achieve a minimum of 18% Tax to GDP ratio within the next 3 years without stifling investment or economic growth.
”It should be noted that this committee will not only advise the government on necessary reforms, but will also drive the implementation of such recommendations in support of the comprehensive fiscal policy and tax reform agenda of the current administration” the President’s aide added.
The Special Adviser to the President on Special Duties, Communications and Strategy, Mr. Dele Alake, described the Chairman of the committee, Taiwo Oyedele, as a highly accomplished professional with extensive expertise in fiscal policy, taxation, and economic matters.
Apart from serving currently as PWC Africa tax leader, he also holds several important positions in prestigious organizations, including professional bodies locally and internationally.
