The Speaker of the House of Representatives, Abbas Tajudeen, has clarified that the legislative body has not yet taken an official position on the contentious Tax Reform Bills currently under review. Speaking at an interactive session on Monday at the National Assembly, Abbas assured stakeholders of the House’s commitment to scrutinizing the proposed legislation and addressing areas of concern.
The bills under consideration include the Nigeria Tax Bill, Nigeria Tax Administration Bill, Nigeria Revenue Service Establishment Bill, and Joint Revenue Board Establishment Bill. These proposals, submitted by the Presidency last month, have drawn criticism, including calls for withdrawal by the National Executive Council (NEC). Despite the controversies, President Bola Tinubu has urged continued dialogue, calling on stakeholders to express their concerns during the public hearing process.
Abbas emphasized that the interactive session was aimed at fostering understanding and collaboration between lawmakers and stakeholders. “This interaction will help us identify parts that need amendments and ensure the bills align with the interests of the executive, legislature, and Nigerian citizens,” he stated. He underscored the importance of tax reforms in boosting Nigeria’s fiscal sustainability, citing the nation’s low tax-to-GDP ratio of 6 percent, which is significantly below the global average and the World Bank’s benchmark of 15 percent.
“Tax reforms are crucial for fiscal stability and reducing our reliance on debt financing,” Abbas remarked. However, he also stressed the need for a balanced approach, ensuring that reforms do not disproportionately burden citizens or businesses.
Expert Concerns Over Nigeria’s Economic Situation
Adding to the discussion, Taiwo Oyedele, Chairman of the Presidential Fiscal Policy and Tax Reforms Committee, painted a sobering picture of Nigeria’s economic challenges. He highlighted the country’s soaring inflation, rising public debt, and the significant depreciation of the naira compared to other African currencies such as the Kenyan shilling and South African rand.
“In 2020, 97 percent of Nigeria’s revenue was used for debt servicing,” Oyedele noted, underscoring the urgent need for fiscal discipline and effective budgetary measures. He attributed the relative stability of other African economies to stronger policy reforms, calling on Nigeria to follow suit to avoid deepening economic instability.
Oyedele also emphasized that tax reforms must focus on creating a robust and equitable system that drives revenue generation without stifling economic growth.
A Path to Economic Stability
The Tax Reform Bills are part of President Tinubu’s broader economic strategy to improve revenue generation and reduce Nigeria’s dependency on borrowing. While debates around the proposals continue, lawmakers, policy experts, and the executive agree on the need for reforms to address the country’s mounting fiscal challenges.
As public hearings progress, all eyes remain on the National Assembly to strike a balance between promoting fiscal stability and safeguarding the interests of Nigerian citizens and businesses.
