Mr. Taiwo Oyedele, Chairman of the Presidential Committee on Fiscal Policy and Tax Reforms, advocates for urgent Tax Reform Bills to address the struggles of Nigerians. The proposed changes aim to create a fairer distribution of VAT revenue and respond to economic hardships. However, Governor Zulum raises concerns about potential negative effects on Northern Nigeria, claiming there has not been sufficient consultation on the reforms. Oyedele emphasizes the importance of quick legislative action to alleviate poverty and inflation issues.
Mr. Taiwo Oyedele, Chairman of the Presidential Committee on Fiscal Policy and Tax Reforms, emphasized the urgent necessity for the enactment of Tax Reform Bills to alleviate the financial struggles faced by the majority of Nigerians. His remarks, made during a recent Arise News interview, came in light of Borno State Governor Professor Babagana Zulum’s concerns regarding the potential implications of the bills currently under consideration by the National Assembly.
Mr. Oyedele contended that the proposed 60% derivation in the Value Added Tax (VAT) distribution would be instrumental in achieving greater fairness in revenue allocation while stimulating economic activity across the nation. In response to Governor Zulum’s criticism of haste in the reform process—citing misconceptions about the benefits primarily favoring Lagos and Rivers States—Oyedele refuted claims of rushing, arguing that the needs of the Nigerian populace require immediate attention. He noted that the economic hardships experienced by citizens necessitate swift legislative action, likening the urgency to the global response during the COVID-19 pandemic.
The governor had articulated concerns over the tax proposals, advocating for a more measured approach to allow for extensive consultations. He posited that the current framework would disadvantage Northern Nigeria due to a perceived inequity in tax benefits. In his defense, Oyedele remarked that discussions had already been held with various stakeholders, including governors, and the bills have undergone scrutiny in the National Assembly for over a month. He asserted that the focus on this issue is healthy and should be harnessed for productive engagement among all parties involved.
Oyedele further explained that the proposed tax reforms aim to rectify existing disparities, which he had not anticipated would provoke such resistance from other regions. He suggested that the dialogues until now have been constructive and should continue to ensure that the reform efforts provide tangible relief to those affected by the ongoing economic challenges.
Additionally, the new tax framework seeks to modify the current distribution of VAT revenues under Section 40 of the VAT Act, shifting allocations to enhance equity between the federal government and state entities. This move has stimulated debate, particularly among Northern elites who view the changes as potentially detrimental to their economic interests. At present, the VAT allocation allows 15% to the Federal Government, 50% to states, and 35% to local governments, incorporating mechanisms for equitable distribution based on population and equality.
Oyedele concluded by underscoring the importance of expeditious progress in the tax reform process to ensure essential support for the populace amid rising inflation and associated socio-economic issues.
The topic of tax reforms in Nigeria is particularly pressing as it addresses the widespread financial challenges facing citizens. Recent discussions have revolved around the proposed changes to the tax regime, especially concerning the distribution of Value Added Tax (VAT). These reforms aim to create a more equitable sharing of resources among regions in the country, which has sparked intense debate, particularly among political leaders and stakeholders across various states. A key point of contention is the impact of these reforms on different regions, highlighting the complexities of Nigeria’s fiscal policy landscape.
In summary, the call for urgent tax reforms in Nigeria by Mr. Taiwo Oyedele underscores the dire economic conditions faced by many citizens. While the proposed changes to the VAT distribution seek to foster equity and stimulate economic growth, they have also elicited significant pushback, particularly from Northern leaders. It is imperative that all stakeholders engage collaboratively to refine these measures, ensuring that they deliver the intended relief to those in need without exacerbating regional disparities.
Original Source: punchng.com
