Tax Bills Spark Heated Debate as NCL, Afenifere, ACF and Ohanaze Submit Memorandum
By Usman A Harande
President Bola Ahmed Tinubu’s proposed tax reform bills have ignited a firestorm of controversy, with over 200 groups, including the Nigerian Labour Congress (NLC), Afenifere, Arewa Consultative Forum (ACF), and Ohanaeze, submitting memoranda to the National Assembly.
The bills, which aim to overhaul Nigeria’s tax system, have been endorsed by some groups, such as Afenifere, who believe they will stimulate economic growth and improve revenue generation. However, others have expressed concerns about the potential impact on the economy, citing the need for caution and further consultation.
Key Provisions of the Tax Reform Bills
The proposed tax reform legislation comprises four primary bills:
- Nigeria Tax Bill 2024: Seeks to consolidate existing tax laws into a unified framework, simplifying the tax system and making it more accessible for taxpayers.
- Tax Administration Bill: Aims to streamline tax administration processes, enhancing efficiency and reducing bureaucratic hurdles for both taxpayers and authorities.
- Nigeria Revenue Service Establishment Bill: Proposes the creation of a centralized tax agency, the Nigeria Revenue Service, to replace multiple tax collection bodies, thereby improving coordination and effectiveness.
- Joint Revenue Board Establishment Bill: Intends to establish a Joint Revenue Board to harmonize tax policies across federal, state, and local governments, ensuring consistency and fairness in tax administration.
Implications for Individuals and Businesses
The tax reform bills have significant implications for individuals and businesses in Nigeria. Some of the key provisions include:
- Exemption from Income Tax: Small businesses with an annual turnover of ₦50 million or less are exempt from income tax.
- Reduction in Companies Income Tax: The bills propose a reduction in companies income tax from the current rate of 30% to 27.5% for 2025 and 25% for subsequent years.
- Tax Credits for VAT: Businesses will be granted tax credits for VAT paid on their assets and all expenses incurred to produce Vatable goods and services.
As the debate continues, it’s clear that the outcome will have significant implications for Nigeria’s economy and citizens. Stay tuned for further updates on this developing story.
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