The Chairman of the Presidential Fiscal Policy and Tax Reforms Committee, Taiwo Oyedele, has refuted claims by Northern governors and elites that they were not consulted on the controversial Tax Reform Bill. Speaking during a town hall meeting on the bill organized by Channels Television, Oyedele emphasized that consultations were extensive and inclusive.
The Tax Reform Bill, which has faced stiff opposition from Northern elites, particularly over its Value Added Tax (VAT) provisions, has sparked a national debate. Critics, including Senator Ali Ndume and Borno State Governor Babagana Umara Zulum, argue that the bill disproportionately favors Lagos State at the expense of the North.
The Nigeria Tax Administration Bill proposes significant changes to VAT distribution. Under Section 77, the federal government’s share of VAT revenue would reduce from 15% to 10%, while state governments would receive 55% and local government councils 35%. Additionally, 60% of the VAT allocation would be distributed based on consumption metrics.
Oyedele defended the reforms, asserting that the committee prioritized consultations. “We consulted. We had one session with the Governors’ Forum. They won’t say we didn’t consult them. They’re saying we need to consult more, which we agree with. But it is not correct to say that we did not consult,” he said.
The tax expert detailed the consultation process, which included engagements with the National Economic Council, finance commissioners, internal revenue service heads, and governors across geopolitical zones. However, Oyedele admitted that some governors were unavailable during these sessions.
On the contentious establishment of the Nigeria Revenue Service (NRS) to replace the Federal Inland Revenue Service (FIRS), Oyedele explained that the move was aimed at enhancing efficiency in revenue collection.
“Our revenue collection is less than 20% of what South Africa’s revenue service collects. This is not about scrapping agencies or introducing new taxes; it’s about institutional reform to optimize revenue,” he clarified.