From Sola Ojo, Abuja
A fresh storm of controversy has erupted over President Bola Tinubu’s proposed tax reform bills, with the Kaduna Chamber of Commerce, Industry, Mines, and Agriculture (KADCCIMA) leading the charge against the bills based on the timing and ‘zero’ consultation by the promoters.
Despite President Tinubu’s assurance that the reforms have come to stay and that he is able to lead Nigeria through the reforms at his maiden media chat in Lagos, critical tax experts and business operators in the North still have mixed feelings towards the entire tax reforms.
Although Mr. President spoke diplomatically on the Value Added Tax (VAT) during that chart, the northern tax experts and stakeholders are still not convinced that the time is ripe for such debate, let alone forcing it on Nigerians who are currently finding it difficult to feed and operate micro-businesses due to the hash economy.
The four executive bills include the Nigeria Tax Bill 2024, the Nigeria Tax Administration Bill, the Nigeria Revenue Service Establishment Bill, and the Joint Revenue Board Establishment Bill.
If passed into law, these bills are expected to overhaul tax administration and revenue generation in Nigeria, as many of the provisions contained in them are said to be landmark in nature.
This notwithstanding, the KADCCIMA President has called for the withdrawal of the bills, citing lack of consultation with Nigerians who will be affected by the reforms.
He said that going through the bills, “we discovered that certain steps should have been taken before sending it to the National Assembly.
“One of those things would have been to engage Nigerians who the bills are meant to affect.
“There were general outcry on the bills. We earlier told the Presidency to withdraw the bills. We learned the National Assembly has asked that Nigerians should be allowed to discuss the bills.
“So, with that window granted, KADCCIMA is engaging the business community, academic community and stakeholders who may be affected by the bills to see what we can push for our collective survival”, he said.
A council member of KADCCIMA, Joseph Samuel, an engineer, echoed the President’s concerns, stating that the bills have “grey areas” that need to be addressed, particularly with regard to Value Added Tax (VAT) and derivation.
Samuel also expressed concerns about the impact of the reforms on the education sector.
“The tax reform bills as being proposed by Mr. President is a laudable attempt to harmonize some old tax laws we have been operating since independence or thereabout.
“However, there are grey areas in the proposed bills, especially the clauses around VAT and derivation. We also have an issue around the education sector where they are proposing that the education tax, as it is, would stop and go to TETFund.
“Raising VAT from current 7.5 per cent to 10 per cent and 12.5-15 by 2030 or so without clarifications and proper consultation will mean there will be issues around implementation because when people don’t understand what you are doing, they won’t join you”, he opined.
In a similar view, the Managing Consultant of Time-Line Consults Limited, Shuaibu Idris, argued that the president needs to improve his level of tolerance and engage in wider consultation with Nigerians.
“Mr. President has to improve on his level of tolerance. He may have excellent ideas and good intentions, but they are to be politically presented in such a way people can understand and see reason to key into them.
“There has to be a wider consultation. People with varying degrees of diverse views should be allowed to air their opinions and criticism.
“To me, it is wrong for him to have refused to hid the advice of the National Economic Council (NEC) that recommended the withdrawal of those bills.
“So, if these bills see the light of the day, it is not only the North that will suffer, some states across the geo-political zones including Osun, Ekiti, Abia, among others, will also be at the disadvantage positions”, he noted.
However, not everyone in the North is opposed to the reforms.
Deputy Vice Chairman of the Chartered Institute of Taxation of Nigeria, Kaduna District and Society, Idiagi Umarfaruk, argued that the bills have many positive aspects that the North can benefit from.
Umarfaruk, who was also the past chairman of ICAN, Kaduna District and Society, a tax practitioner, encouraged northerners to tap into their resources and take advantage of the provisions in the tax laws.
“As a professional and a northerner, we should embrace the whole bill with a positive mind. I totally agree with reservations concerning timing and ambiguity in some provisions.
“However, on a large scale, there are so many positive things the North can tap from these bills. I want us to see it as a wake-up call for us in the North to begin to tap into our docile and slumbering resources.
“We have the human power which is our population. We have land, which is one of the key factors of production; we have favourite weather conditions to cultivate different crops, process and market them to our advantage.
“The only challenge we are having is insecurity. This is one key thing that our political and economic leaders should pursue with the Federal Government to invest more in security so that we will be able to do business.
“The second challenge is our weakness in being genuinely interested in business. Our governors, chairmen and counsellors should begin to think within and outside the box to see how we can take advantage of the provisions in the tax laws.
“The worrying part is the implementation of 10 per cent VAT starting in January 2025. That should be stepped down. Let us use the year 2025 to discuss and plan for its implementation in 2026. The other aspects, like derivation and tax administration, I don’t have an issue with that.
“In addition, there is a reservation on whether the new proposed name for Federal Inland Revenue Service to Nigeria Revenue Service whether the federal inland revenue can collect all the revenues.
“As a professional, it is only the FIRS in Nigeria today that has all human, technology and other resources to be able to collect all taxes. Yes, we can improve on it. It will help the states to tap into it.
“For me, it is all positive. Let the North just take advantage of it. If we fail to do that, then, we may have to open the door for the alternative and I can tell you that the alternative will not be okay for us”, he posited.