…Tinubu Directs Immediate implementation of recommendations across MDAs
The Presidential Committee on Tax Reforms and Fiscal Policy, on Tuesday, recommended the trimming of the long list of officially collectible taxes and levies, currently exceeding 60, to a manageable single-digit number.
Chairman of the committee, Taiwo Oyedele, disclosed this to newsmen after submitting his team’s maiden report, which he called 30-day “quick-wins” in the committee’s assignment, to President Bola Tinubu at State House, Abuja.
President Bola Tinubu has also directed the immediate implementation of all recommendations by the Presidential Committee on Tax Reforms and Fiscal Policy, across federal ministries, departments and agencies (MDAs).
The Presidential Committee on Tax Reforms and Fiscal Policy, while presenting its maiden report of its activities to the President, recommended trimming the long list of officially collectible taxes and levies, currently exceeding 60, to a manageable single-digit number.
Chairman of the committee, Mr. Taiwo Oyedele, disclosed this to newsmen after submitting his team’s maiden report, which he called 30-day “quick-wins” in the committee’s assignment, to President Bola Tinubu at State House, Abuja.
Oyedele, who spoke in the company of the Acting Chairman of the Federal Inland Revenue Service (FIRS), Mr. Zacch Adedeji, explained that the tax committee’s aim was to consolidate the taxes at all levels of government and reduce the total number to less than 10.
Commenting on the fundamental reason for reforming the country’s tax policy and removing impediments to business, the chairman said his team had started rewriting the tax laws as part of the process of birthing a standard and more effective tax regime. He said the task of restructuring the tax system in the country would not be achievable through the courts, citing the circumstances around the Value Added Tax (VAT), but by assembling stakeholders for deliberations and approaching the National Assembly.
Oyedele added that, unofficially, there were more than 200 different taxes in Nigeria, which significantly burdened the population and made life challenging for the citizenry. However, he stressed that approximately 96 percent of the total revenue collected by the federal, state, and local governments was derived from a small set of about 10 taxes.
He stated that Nigeria was currently at a critical phase of revising its laws and regulations on taxation, adding that the committee has interfaced with the Senate and House of Representatives with the objective of addressing necessary reforms.
He stated that the committee had commenced public consultation and stakeholder engagement on tackling some of the controversies around the VAT law, asserting that solutions will only come from Nigerians and not from the law court.
“So all we did today was to formally present the report to Mr. President, but I will say that once we get the nod from Mr. President, it will be like just switching on the tap and then the implementation starts immediately,” he said.
Oyedele added, “There’s so much work for us to do, this is just milestone number 1, it is what we call the quick wins. The second phase, which is where we are now, is the critical reforms.
“Those critical reforms involve even rewriting our major tax laws, addressing something that everybody in this room will be very familiar with: multiplicity of taxes.
“We have over 60 taxes and levies, officially collectible by the federal government, state governments and local governments. Unofficially, those taxes are over 200, making life difficult for our people. So the objective we have, and that’s what we’re working towards, is to bring all of that to a single digit.
“So the taxes at all levels of government combined, we think, should be less than 10 because, actually, about 96 percent, actually more than that, of our revenue across federal, state, local governments, currently, is generated from less than 10 taxes, and we’ve seen countries, like South Africa, generating more than our entire national tax revenue from just one tax.”
The Chairman stated that there was no evidence to show that more taxes translated to more revenue. “In fact, the contrary is true,” he said, adding, “The more the number of taxes you have, actually the less revenue you collect, because it just creates the opportunity for leakages and some non-state actors collecting money and keeping it to themselves.
“We were speaking to traders, MATAN (Market Traders Association of Nigeria) and they said to us, that people selling ‘pure water’ in the market collect seven tickets every single day. Why should someone who is just trying to hawk ‘pure water’ to keep body and soul together have to pay seven taxes on a daily basis? It doesn’t make a lot of sense to us.
“So now we are at that phase of rewriting our laws. We spent time with the Senate and we would also do the same thing with the House of Representatives and the whole idea is, that we think that some of the reforms we need to introduce have to go to the constitution itself, lack of clarity about taxing rights between levels of government.”
The tax reform committee chairman also stated, “We’re all familiar with the dispute around VAT (Value Added Tax). We think that the solution will not come from the courts, it will come from Nigerians coming together to say ‘actually, this is the best way to deal with these matters’.
“We have commenced our public consultation and stakeholders’ engagement; it’s open until the 15th of November. I’m glad to inform you that after just a few days of opening up that platform for engagement, we have received inputs from every single state in Nigeria and we’re just starting.”
But just as the committee chairman was rounding up it briefing with journalists, the President directed the immediate implementation of all recommendations by the committee across federal MDAs.
The president gave the directive after receiving the report from the Oyedele-led committee in Abuja.
Briefing newsmen after the meeting at State House, Special Adviser to the President on Media and Publicity, Ajuri Ngelale, disclosed that Tinubu directed his adviser on policy coordination, Hadiza Bala-Usman, to liaise with Secretary to the Government of the Federation (SGF) and Oyedele for the effective implementation of the presidential directive.
Ngelale said the directive to escalate the recommendations across government establishments was to ensure effective synergy and assimilation in their implementation.
According to him, “After listening to a presentation by the committee chairman, the president directed the Special Adviser to the President on Policy Coordination, Hadiza Bala-Usman, to liaise with the Secretary to the Government of the Federation and the chairman of the tax policy review committee to ensure that the recommendations of the committee were swiftly and immediately implemented across all ministries, departments, and agencies of the federal government to ensure that there was effective synergy and for every institution of the federal government to be on the same page with respect to how tax policy would be implemented.”
The media adviser also explained that the president promised to make the committee’s recommendations a priority at the next meeting of the Federal Executive Council (FEC).
He stated, “Henceforth, Mr. President has also made available an opportunity for the recommendations of the tax policy review committee to be made a topmost priority at the next sitting of the Federal Executive Council.
“Mr. President will continue to emphasise the importance of ensuring that our tax authorities are not taxing the seed, but are taxing the fruit and that will continue to be the focus.”
