- The fiscal policy and tax reforms committee wants taxes food, house rents, public transportation, others to be removed
- Its proposal also includes the removal of VAT on these necessities and tax exemption for companies
- Since its inauguration a year ago, the committee has proposed various tax frameworks
Taiwo Oyedele, the chairman of the Presidential Fiscal Policy and Tax Reforms Committee, says President Bola Tinubu will soon sign the committee’s proposal to the Federal Government for the removal of taxes on food, public transportation, house rents, health and education, which are basic necessities.
Oyedele disclosed this while appearing as a guest on Channels TV’s programme, Politics Today, on Monday, September 3 and said the committee’s proposal includes the exemption of value-added tax (VAT) on the basic necessities.
He said President Tinubu, after signing the proposal, will send it to the National Assembly for legislation and to make it part of the country’s tax laws.
Oyedele said, “What we have taken into account is what are those basic necessities of life: food, accommodation, transportation, education and health. We have deliberately identified those items and have removed almost all the taxes applicable to them, including no VAT.
“We think that from the fiscal policy and tax perspective, we can make it more affordable for the Nigerian people to be able to afford those basic necessities.
“Share passenger transportation is completely tax-free. However, if you hire a taxi, we assume you are not the poorest Nigerian, so, you have to pay the tax. Whereas, if you get into a bus, that will be completely tax-free. That is what we have done so far.”
‘We are offering tax exemptions to companies to spur job creation’
On the committee’s efforts towards ameliorating the taxes paid by companies and private sector employers, Oyedele said the committee has proposed offering tax exemptions as part of the incentives aimed at spurring job creation and boosting employment.
The tax committee chairman said the policy will provide some relief to businesses while they are creating jobs.
He said, “We have also developed some proposals where the government can give relief to private sector employers who provide transportation relief to their workers.
“Also, we have had proposals around more employment. So, if an employer employs more people than they will normally do, they get some relief. That helps to stimulate employment generation.”
Fiscal policy and tax reform committee have been advocating tax reduction
Since the presidential committee on fiscal policy was inaugurated in August 2023 by President Tinubu, it has concerned itself with creating a new tax framework that will drive economic growth and development.
The committee recommended the streamlining and harmonisation of taxes and levies paid by businesses and individuals into eight headings to make tax administration modern, simple, adaptive and enable economic growth.
Oyedele said the proposed list of taxes and levies will include income tax, property tax, VAT, customs duties, excise tax, stamp duties, special levy and harmonised levy.
He also said the Federal Government is working towards a system that will exempt 95 per cent of businesses in the informal sector that mostly earn N25 million or less yearly from paying all taxes including withholding tax, company income tax and payroll taxes.
Oyedele added that the informal sector comprises “people simply trying to earn a living” and should not be burdened with taxes, instead, government officials and the elite would be targeted for tax compliance.
FG suspends import duties, taxes on essential food items to address inflation
Meanwhile, TheRadar reported that the Federal Government announced the suspension of import duties and taxes on essential food items to make them affordable and to address food inflation.
The suspension was disclosed by the Comptroller General of the Nigeria Customs Service (NCS), Bashir Adewale Adeniyi, on Tuesday, July 30, who reiterated the Federal Government’s commitment to implementing import duties and tax suspension seamlessly to tame food inflation and combat hunger in the country.
