After five months of negotiations and a public hearing, the House of Representatives approved the Finance Committee’s report on tax reform.
This significant decision advances the hotly contested bills, marking the conclusion of an extensive legislative review process.
Furthermore, the approval follows persistent debates regarding the impacts of fiscal policy on various sectors.
Advocates and critics alike engaged in discussions, emphasizing the importance of thorough analysis and consideration of public interests.
The decision marks a significant step forward in the legislative process, as the bills now move closer to becoming law.
The adopted reforms include several key amendments aimed at addressing concerns raised by various stakeholders.
The changes include retaining the Value Added Tax (VAT) rate at 7.5 percent and redefining inheritance tax provisions. Additionally, they involve adjustments to the distribution framework for VAT revenues.
The House approved a proposal to exempt military personnel from personal income tax, viewing it as support for the armed forces. Notably, this decision reflects a strong commitment to recognizing the sacrifices made by those in uniform.
House Speaker Tajudeen Abbas emphasized the unanimous nature of the decision during the session. He stated, “This is the first time such a report received one hundred percent approval from almost all members.” This overwhelming support highlights the collective agreement on the importance of this initiative.
This strong consensus underscores the commitment of the House to support significant reforms and initiatives.
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All 36 states, along with the Federal Capital Territory, actively participated in the subcommittee that developed these bills. This representation from various regions ensured a comprehensive perspective on the issues at hand.
The deliberative process that led to this adoption was indeed extensive and involved multiple phases. According to James Faleke, Chairman of the House Committee on Finance, over 80 key stakeholders contributed input during three days of public hearings.
Following the public hearings, he explained, “We held an eight-day retreat to debate each clause thoroughly.” This retreat allowed members to examine the details and implications of each provision meticulously.
Ultimately, Faleke expressed his satisfaction that House members recognized their efforts and approved all recommendations.
The tax reform bills currently under consideration include the National Revenue Services (NRS) Bill, Nigeria Tax Bill, Tax Administration Bill, and the Joint Revenue Board Establishment Bill. These legislative measures emerged after President Bola Tinubu requested the National Assembly prioritize their passage in October 2024.
Although some clauses in the bills initially sparked concerns and calls for withdrawal, President Tinubu remained steadfastly supportive of the reforms. He emphasized their importance for economic growth and insisted on the need for these vital changes.
He argued that these measures are critical for Nigeria’s economic progress and fiscal stability.
With this adoption by the House of Representatives, the bills are now poised for formal passage. The development represents a milestone in Nigeria’s ongoing quest for a more efficient and equitable tax system.
