Tax Reform Bills: Senate pauses public hearing following agitations

• The Senate has stayed action on public hearings of the tax reform bills
• This is due to public agitation and objections to the bills
• The Senate also constituted a special committee to meet with the executive arm to resolve issues of concern

The Senate has suspended action on the tax reform bills it is currently considering and instructed the Committee on Finance to pause the public hearing of the bills until issues surrounding the bills are resolved.

The Senate’s action followed widespread agitations and objections in the public space against the bills.

It further constituted a special committee to meet with the executive arm and work with the Federal Government to resolve the issues surrounding the tax reform bills.

The Deputy Senate President, Jibrin Barau, stated this while presiding over the plenary on Wednesday, November 4.

Barau said, “In this regard, we have decided to set aside politics, ethnicity, and regionalism to work together on resolving the issues surrounding the tax reform bills.

“In collaboration with the executive arm of government, we agreed to establish a forum to identify and address contentious areas to ensure national unity and progress.

“Before the introduction of these bills, we faced numerous challenges, including insecurity and economic issues.

“The President has been working to address these problems, and we are committed to supporting these efforts while tackling global economic challenges. We also agreed that no other issues should aggravate the country’s current difficulties.

“It has been mutually decided between the Executive and the Senate to engage the Judiciary to sort out these matters.

“The Attorney General of the Federation will be involved in discussions to identify and resolve areas of disagreement for the nation’s benefit.

“Tomorrow, the committee established by the Senate, along with its leadership, will meet with the Attorney General to address these issues.

“Consequently, the Senate Committee on Finance has been directed to pause further actions on public hearings and other matters related to the tax reform bills until the issues are resolved.”

The Senate’s Committee on Finance comprises all the leadership of the Senate including other members.

They are Adamu Ailero, Orji Kalu, Seriake Dickson, Titus Zam, Abdullahi Yahaya, Adeola Olamilekan, Sani Musa and Adetokunbo Abiru.

Bills have been greeted with criticisms

There have been controversies and criticisms around the tax reform bills from different quarters since its initiation. While some are calling for wider consultations before passage, others, like the Afenifere, have endorsed the bills.

These objections necessitated President Bola Tinubu to direct the Federal Ministry of Justice to work with the National Assembly to ensure that “genuine concerns” associated with the Tax Reform Bills are addressed before their passage by the lawmakers.

During a meeting in October, the Northern Governors Forum said some aspects of the bills, especially the VAT components, are skewed against the interests of the North.

The forum further called on the lawmakers from the region in the National Assembly to reject the bills.

The bills were also challenged by the National Economic Council, which comprises the governors and chaired by the Vice President, Kashim Shettima.

The council asked President Tinubu to withdraw the bills from the National Assembly for further consultations, but the president insisted that any differences should be resolved in parliament.

The tax reform bills aim to streamline taxes

President Tinubu had sent the four tax bills to the National Assembly for approval in October. The bills are the Nigeria Tax Bill 2024, the Tax Administration Bill, the Nigeria Revenue Service Establishment Bill, and the Joint Revenue Board Establishment Bill.

The Nigeria Tax Bill 2024 is expected to provide the fiscal framework for taxation in the country, the Tax Administration Bill will provide a legal framework for all taxes in the country and reduce disputes, the Nigeria Revenue Service Establishment Bill will repeal the Federal Inland Revenue Service Act and establish the Nigeria Revenue Service, and the Joint Revenue Board Establishment Bill is expected to create a tax tribunal and a tax ombudsman.

The bills seek to review the sharing formula of the Value Added Tax (VAT) to accommodate what each state gets VAT for what it generates within its territory.

They also seek to remove VAT from essential consumption, education, healthcare, transportation, and accommodation to benefit low-income earners.

Senate passes tax reform bills for second reading

Meanwhile, TheRadar reported that the Senate passed the tax reform bills forwarded to it by President Bola Tinubu in October 2024 for a second reading.

The bills were passed on Thursday, November 28, following a debate among the lawmakers. They were then referred to the Committee on Finance for further legislative action and asked to report back within six weeks.