Piloting the ship of state amidst the stormy economic waters of ever increasing rates of inflation, skyrocketing fuel prices, electricity tariff, transportation demands circumspection, inclusiveness and of course, consensus building.

Unfortunately, the absence of these critical factors has cumulatively led to the waves of controversy and contest that have so far trailed the Nigeria Tax Bills 2024.

Worthy of note is that the four tax reform bills were introduced to the National Assembly by the President Bola Tinubu-led government on September 3 this year.

The reforms came from the recommendations of the Presidential Committee on Fiscal and Tax Reforms headed by Taiwo Oyedele.

The aim is to provide a fiscal framework for taxation in the country and the Tax Administration Bill is to provide a clear and concise legal framework for all forms of taxes as well as to reduce disputes.

Other aspects of the Tax Bills include the Nigeria Revenue Service Establishment Bill, aimed at repealing the Federal Inland Revenue Service Act and Establishment. The Nigeria Revenue Board Establishment Bill is to create a tax tribunal and a tax ombudsman.

What has fuelled the debate and opposition to the bill is the proposed shift to a derivation-based Value Added Tax (VAT) distribution.

The modus operandi is to allocate tax revenue to the state where goods and services are consumed, rather than where the companies have their headquarters.

Hence, it is quite understandable why the bills were out rightly rejected by the 19 Northern governors under the aegis of the Northern Governors Forum (NGF) and the Northern traditional rulers. Their rejection stemmed from the new derivation -based model for VAT distribution.

And it is all because the contents do not align with the interests of the North geo-political zone and the subnational entities. Not left out of the rejection is the National Economic Council headed by the Vice President, Kashim Shettima. It has called for the withdrawal of the bills to allow for wider consultations and consensus building.

We cannot agree any less as the responses from a broad spectrum of the Nigerian society speak to the wrong timing, framework and focus of the tax reforms.

The reasons are not far-fetched. Firstly, the timing is absolutely wrong, coming within the current excruciating economic environment.

Instead of the government of the day focusing its energy and resources on how to provide an enabling environment for businesses – both small scale and large industries – to thrive, it is busy attempting to foist all manner of taxes on the poor masses. That is the valid position of Senator Ogoshi Onavo, representing Nasarawa South Senatorial District.

Beyond the President Tinubuled government urging NEC to make inputs on the debate during public hearing at the legislative chamber, it should also listen to the cries of the hungry citizens

As he aptly stated: “It is unfair for the government to continue imposing taxes on Nigerians who are currently battling economic hardship.” Furthermore, he views it as an open display of crass insensitivity on the part of the government.

Similarly, Senator Ali Ndume, Borno South Senatorial District has rejected it and vowed to mobilise other lawmakers from the north to do likewise. However, some other individuals and groups have pitched their tents with the Federal Government, with reasons to ponder over.

Amongst those in support of the Tax Reform Bills are human rights activist, former Senator Shehu Sani, who represented Kaduna Central Senatorial District, and the Human Rights Writers of Nigeria (HURIWA) led by Comrade Emma Onwubiko.

The latter has called on the Northern governors and senators to focus their attention on economically liberating and empowering their people rather than igniting ethnic and regional tensions.

What is of significance, according to HURIWA, is for the Northern political leaders to engage in meritbased debates around the new tax reform bills.

And in a similar vein, Shehu Sani has called for avoidance of primordial sentiments in response to the bills. In his candid opinion, they are not inimical to the north.

Rather, they are comprehensive and bold recommendations aimed at simplifying tax administration as well as streamlining the operations. In all of these arguments, what is important is for Nigerians to understand that taxation is a tool of fiscal policy as a compulsory levy imposed by the government on the income of tax payers, as it operates in a given geographical area.

Ideally, the aim is to ensure the highest welfare for the greatest number of the citizenry. Over the years, however, the Nigerian situation has been characterised by multiple taxation, lack of credible data, and one in which some rich individuals hardly pay taxes commensurate with their huge incomes.

Added to these is that of spurious tax waivers offered to political apologists. All these were made public by the ‘Peoples’ Parliament’ made up of capital market operators, bankers, accountants, industrialists and academicians during a national conference held in Lagos back in 2017.

According to the former President of the Institute of Chartered Accountants of Nigeria, Otunba Abdullateef Owoyemi, we must ensure that our tax reforms are in sync with international best practices. Also significant is for Nigerians to start asking questions on how and what the taxes are utilised.

Above all, beyond the President Tinubu-led government urging NEC to make the inputs on the debate during public hearing at the legislative chamber, it should also listen to the cries of the hungry citizens.

Providing an enabling environment for business to flow and grow should take precedence over the imposition of all manner of taxes, through a more inclusive engagement with the stakeholders.

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