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The Nigerian Presidency has responded to the recent rejection of the proposed tax reform bills by the governors of 19 Northern States, asserting that the reforms are intended to benefit all states rather than unfairly target the North.
Bayo Onanuga, President Bola Tinubu's Special Adviser on Information and Strategy, explained that the reforms aim to streamline tax administration processes across Nigeria.
Onanuga stated, "While we commend the Governors and traditional rulers for supporting President Tinubu over the success recorded in addressing the country's security challenges, we consider it necessary to address the misunderstandings and misgivings around the tax reform already embarked upon by the administration."
What is the Tax Reform Bill?
The proposed reforms, which include four executive bills currently under consideration by the National Assembly, are designed to enhance efficiency and eliminate redundancies within the tax system.
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The Nigeria Tax Bill seeks to simplify tax obligations for both businesses and individuals, while the Nigeria Tax Administration Bill aims to harmonise tax administrative processes across all levels of government.
The Nigeria Revenue Service (Establishment) Bill also proposes renaming the Federal Inland Revenue Service as the Nigeria Revenue Service to reflect its broader mandate.
The Joint Revenue Board Establishment Bill is also part of the proposed changes, which will create a framework for better coordination among federal and state tax authorities.
Presidency gives clarity
On the controversial derivation-based Value-Added Tax (VAT) distribution model, Onanuga asserted that the new proposal aims to address current inequities.
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"The ongoing tax reform seeks to correct the inherent inequity in the current derivation model," he explained, emphasising that it would ensure states producing essential goods are not disadvantaged.
"These reforms are critical to improving the lives of Nigerians and were not put forward by President Tinubu to undermine any part of the country. There is no better time than now for the National Assembly to give due consideration to these bills," Onanuga stated.