The Presidency has clarified that no provisions of the proposed Tax Reform Bills before the National Assembly was intended to impoverish the northern Nigeria.
Special Adviser to the President on Information and Strategy, Bayo Onanuga, made the clarification in a statement on Monday, December 2, 2024.
Recall that the Borno State Governor, Prof. Babagana Zulum on Sunday stated that the proposed tax reforms bills would benefit lagos state, to the disadvantage of other states, including the north.
However, Onanuga said the tax reform bills would not make Lagos or Rivers more affluent and other parts of the country, as recklessly canvassed, poorer, adding that the bills would not destroy the economy of any section of the country.
Instead, he said, the bills aimed to enhance the quality of life for Nigerians, especially the disadvantaged, who are trying to make a living.
He also contended that contrary to the lies being peddled, the bills do not suggest that the National Agency for Science and Engineering Infrastructure (NASENI), Tertiary Education Trust Fund (TETFund) and National Information Technology Development Agency (NITDA)
will cease to exist in 2029 after the passage of the bills.
He explained that government agencies, such as NASENI, TETFUND, and NITDA, are funded through budgetary provisions with company income tax and other taxes paid by the same businesses that are being overburdened with the special taxes.
According to him, one reason President Bola Tinubu embarked on the Tax and Fiscal Policy Reforms is the need to streamline tax administration in Nigeria and make the operating environment conducive for businesses.
He said “for decades, businesses, investors, and private sector players in Nigeria have complained of being overburdened by a myriad of taxes and levies, including those earmarked to fund various government agencies and initiatives.
“The multiple taxes complicate the economic environment, making Nigeria uncompetitive for investment and preventing many businesses from growing or continuing their operations.
“Some companies have had to make the rational decision to relocate to other countries. We can not continue on this path or wait for 20 years if this country is to deliver the prosperity we need for our people.
“The proposal, as contained in section 59(3) of the Nigeria Tax Bill, only seeks to consolidate some of the earmarked taxes imposed on companies and replace them with a single tax to be shared with the key agencies as beneficiaries in a phased manner until 2030.
“The time frame offers ample opportunity for the affected agencies to explore other funding sources in addition to budgetary allocations in line with the constitution and international best practices,” Onanuga explained.
He submitted that it was a misrepresentation of facts to conclude that changing an agency’s funding source amounts to scrapping it, explaining that none of the countries leading globally in education, science, engineering, or information technology have similar earmarked taxes.
“The government imposes major taxes, be it income tax, consumption tax, or other taxes, to channel resources to its areas of priority at the time.
“Imposing a separate tax to fund an agency is an aberration that has yet to yield results despite the huge burden on businesses. The tax bill seeks to address this problem.
“Relevant stakeholders and public analysts owe it a duty to properly educate themselves about the bills’ contents and avoid misleading the public for any reason.
“We may be entitled to our opinions, but such views must be informed and based on facts, not emotions targeted at inflaming passions.
“In a period like this, when our people across the country look up to leaders for guidance and direction on matters of public importance, such as the Tax Reform Bills, leaders should be more measured in their public utterances to avoid heating the polity and polarising the country unduly.
“President Tinubu welcomes the public interest these bills have generated.
“He encourages leaders across the country, including Governors, Traditional rulers, Civil Society Activists, Students, trade associations, professional associations, and the general public, to take advantage of the Public Hearings that the National Assembly will organise to present their views on how best to reform our taxes and fiscal regime.
“What is never in doubt is the imperative of changing the existing tax laws and administration that have become obsolete and unhelpful in achieving the growth and development we desire for our country,” he said.
