Tax Reform: Reps Postpone Debate Indefinitely 

The House of Representatives has indefinitely postponed the debate on the Tax Reform Bills originally scheduled for Tuesday, December 3, 2024, due to mounting opposition from governors of the 19 northern states. This decision was outlined in a memo titled ‘Rescheduling of Special Session on Tax Reform Bills’, signed by Dr. Yahaya Danzaria, Clerk of the House.

The memo stated that the delay was necessary to allow for broader consultations with relevant stakeholders. It read:
“The special session to discuss all the tax reform bills has been postponed to a later date. A new date and venue will be announced in due course. We regret any inconvenience this may cause and appreciate your understanding.”

The suspension follows opposition from 73 northern lawmakers, including 48 from the North-East, 24 federal lawmakers from Kano, and Senator Aminu Tambuwal, a former Governor of Sokoto State. A leaked video from a closed-door session revealed heated debates among lawmakers, with many citing the adverse economic impact of the proposed reforms on the North.

One North-East lawmaker highlighted the region’s vulnerability, stating:
“Before the insurgency, the North-East was Nigeria’s poorest region. Today, many of our people rely on IDP camps for basic sustenance. These bills could worsen our situation, so we need more time for consultation.”

Similarly, a lawmaker from the North-West suggested that the urgency surrounding the bills was suspicious, adding:
“The governors of the North are unconvinced by the arguments in favor of these bills. We require more time to engage with our people before proceeding.”

President Bola Tinubu had transmitted four tax reform bills to the National Assembly on September 3, 2024, based on recommendations from the Presidential Committee on Fiscal and Tax Reforms, led by Taiwo Oyedele. These include:

1. Nigeria Tax Bill 2024 – Aims to establish a fiscal framework for taxation.
2. Tax Administration Bill – Provides a streamlined legal framework for tax administration.
3. Nigeria Revenue Service Establishment Bill – Replaces the Federal Inland Revenue Service Act.
4. Joint Revenue Board Establishment Bill – Proposes a tax tribunal and ombudsman.

The Northern Governors Forum opposed the bills, particularly the Value Added Tax (VAT) sharing formula, during a meeting in Kaduna on October 29, 2024. They instructed lawmakers to reject the bills, echoing concerns raised by Governor Babagana Zulum of Borno State.

Governor Zulum, speaking to BBC, criticized the speed of the process:
“The Petroleum Industry Bill took almost 20 years to pass. Why rush these tax reform bills? They could have far-reaching consequences for the North and other regions. Let’s ensure they are properly reviewed.”

He also warned that the reforms disproportionately benefit Lagos State, leaving other regions at a disadvantage. Zulum stressed the need for extensive stakeholder engagement, noting:
“This is not opposition but a call for thorough deliberation. If implemented as proposed, these reforms will drag the North and other regions backward.”

Despite assurances of loyalty to President Tinubu, Zulum reiterated his position that deeper consultations are vital to avoid unintended consequences.