Tax Reforms In Nigeria

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SBM Intelligence’s recent survey reveals mixed feelings among Nigerians about the proposed tax reform bills.

While some see the bills as an avenue to simplify Nigeria’s tax system and bolster economic growth, others are concerned about the potential impact on their livelihoods.

Key Concerns:

VAT Increase

Netizens are worried about the proposed gradual increase in Value Added Tax (VAT) from 7.5% to 15% by 2027, fearing this could lead to higher prices for goods and services.

Northern States’ Concerns

Some respondents from Northern states are concerned that the bills could lead to a loss of revenue for their states, particularly with the removal of VAT from agricultural items.

Inadequate Public Engagement

Many individuals feel that the government needs to do more public education about the reforms and address concerns about VAT revenue sharing.

Expert Insights

Muda Yusuf, the former director general of the Lagos Chamber of Commerce and Industry notes that “the tax reform bills are quite technical and may be difficult for average Nigerians to understand”.

Abiodun, a Lagos-based tax consultant points out that the real problem with the bill is that it may not adequately address the concerns of Northern states, particularly with regards to VAT revenue sharing.

What’s Next

Suspending hearings on the bills until the new year, the Nigerian Senate is allowing time for further consultations and negotiations.

President Tinubu has stated that the process is legislative and that inputs can be incorporated during public hearings.

Summarily, while the proposed tax reform bills have the potential to simplify Nigeria’s tax system and boost economic growth, there are concerns that need to be addressed to ensure that the reforms are fair and equitable for all Nigerians.