Connect with us

News

Tax Reforms: A Double-Edged Sword for Nigeria’s Economy

Published

on

ADVERTISEMENT
Zoom Ad
ADVERTISEMENT
Zoom Ad

By Lukman Laleye Babalola.

 

When President Bola Ahmed Tinubu announced his ambitious tax reform agenda, it was clear that he intended to reshape Nigeria’s fiscal framework. The reforms, targeting personal income tax, corporate tax, and value-added tax (VAT) distribution, are undoubtedly bold and necessary. But like any sweeping policy change, they come with both promises and pitfalls.

As someone deeply invested in Nigeria’s socio-economic progress, I see these reforms as a double-edged sword—a tool for much-needed transformation, but one that requires careful handling to avoid cutting too deeply into the fabric of our fragile federal system.

Advertisement

Let us not downplay the potential benefits. The proposed exemption of individuals earning up to ₦800,000 annually from personal income tax is a welcome relief for low-income earners who have borne the brunt of rising inflation. Similarly, the reduction in corporate tax rates from 30% to 25% is a lifeline for businesses struggling to stay afloat in a challenging economic climate.

The overhaul of VAT revenue sharing, which allocates 60% of VAT revenue to the state where goods and services are consumed, aims to promote fairness and encourage states to boost their economic activity. For consumption-heavy states like Lagos and Rivers, this is a much-needed windfall that could translate into better infrastructure, healthcare, and education for their residents.

But these gains are not without costs. Nigeria’s regional disparities could deepen under this new tax regime. Northern states, with lower consumer activity and VAT contributions, stand to lose out, raising concerns about fairness in a nation already grappling with economic inequalities.

The implementation process is another hurdle. Overhauling a tax system is no small feat, and Nigeria’s tax collection mechanisms are notoriously inefficient. Without significant investment in infrastructure and human capacity, the reforms could collapse under their own weight.

Advertisement

Then there is the issue of political resistance. Many lawmakers and regional leaders, particularly from the north, have voiced concerns about the potential loss of revenue under the revised VAT formula. Balancing these competing interests will be a test of the administration’s political acumen.

Under the proposed tax reforms, states like Lagos, Rivers, and others in oil-producing regions stand to benefit significantly. With 60% of VAT revenue allocated to the state of consumption, high-consumption states like Lagos and Rivers are poised to see a substantial increase in their revenue. Lagos alone generates over half of Nigeria’s VAT, and retaining a greater share will empower the state to fund critical projects.

For oil-producing states, increased revenue can be invested in non-oil sectors such as agriculture, manufacturing, and tourism, helping them reduce dependency on crude oil and build more sustainable economies. The additional funds can be used to improve infrastructure, healthcare, education, and other public services, directly benefiting citizens in these states. The reforms also encourage states to create business-friendly environments to attract investments and increase consumption, further boosting revenue generation.

Members of the National Assembly are tasked with ensuring these reforms benefit all Nigerians equitably while addressing regional disparities. Legislators must address the fears of less economically vibrant states and push for transitional mechanisms, such as a redistribution fund, to support regions with lower VAT contributions. They must oversee how states utilize their increased revenues, ensuring the funds are invested in projects that directly benefit the public.

Advertisement

By engaging their constituents, lawmakers can explain the benefits of the reforms, address concerns, and secure public support, thereby easing tensions surrounding implementation. National Assembly members must also facilitate the passage of laws to strengthen tax administration, close loopholes, and ensure effective implementation of the reforms. Legislators from wealthier and poorer states alike must work together to ensure the reforms foster national unity and equitable development across all regions.

The National Orientation Agency (NOA) plays a critical role in ensuring public acceptance and understanding of the tax reforms. The agency must continue to simplify and disseminate information about the reforms to the grassroots, helping Nigerians understand how these changes will benefit them in the long run. By launching campaigns, the NOA can counter rumors and fears about the reforms, especially in regions where there is resistance due to concerns about inequitable benefits.

The NOA should encourage citizens to ask questions and provide feedback on the reforms. This engagement will foster trust and ensure the government remains accountable to its promises. The agency must also address regional concerns by showing how the reforms can be tailored to benefit less economically vibrant states through collaboration with local governments.

The Federal Inland Revenue Service (FIRS) is central to the success of the reforms, as efficient tax collection and administration are critical. The FIRS must invest in modern technology to improve tax collection processes, reduce leakages, and enhance compliance monitoring. Bringing the informal sector into formal taxation while ensuring compliance is not burdensome will also expand the tax net.

Advertisement

Training and equipping tax officers to handle the new tax structures efficiently will be crucial to prevent administrative bottlenecks. The FIRS must regularly publish reports on tax collection and utilization, fostering public confidence in the system. By collaborating with state governments, the FIRS can provide technical assistance to ensure states maximize their VAT collections under the new sharing formula.

As a nation, we cannot afford to shy away from difficult reforms. For too long, Nigeria’s tax system has been inefficient, inequitable, and unable to meet the needs of our growing population. These reforms, though imperfect, represent an opportunity to address these shortcomings and lay the groundwork for a more sustainable fiscal future. However, the government must tread carefully. Transparency, inclusiveness, and stakeholder engagement are non-negotiable. Addressing regional concerns and ensuring efficient implementation will be critical to the success of these reforms.

President Tinubu’s tax reforms have the potential to transform Nigeria’s economy, but they also carry significant risks. Agencies like the NOA and FIRS, along with the National Assembly, must work together to ensure the reforms deliver on their promise of a fairer, more prosperous Nigeria.

As we navigate this critical moment in our nation’s history, let us remember that true reform is never easy, but it is always worth pursuing when done with the greater good in mind.

Advertisement

 

*Lukman Laleye Babalola,is Publisher/Editor-In-Chief,Emporium Reporters online and Emporium Magazine.can be reached on babalolalukman@gmail.com, emporiumreporters@gmail.com.08037469328

Continue Reading
Advertisement
Click to comment

Warning: Undefined variable $user_ID in /home/naijuinz/public_html/wp-content/themes/zox-news/comments.php on line 49

You must be logged in to post a comment Login

Leave a Reply

News

Family Reveals How General Abubakar Died, Says Wife Still In Bandits’ Custody

Published

on

By

ADVERTISEMENT
Zoom Ad
ADVERTISEMENT
Zoom Ad

The family of late retired Major General Rabe Abubakar has disclosed that the former military officer died from a snakebite while being held captive by bandits, contradicting earlier reports that linked his death to complications arising from diabetes and hypertension.

Family members made the revelation during an interview with Deutsche Welle (DW), where they provided fresh details about the circumstances surrounding the retired general’s death and the continued captivity of his wife.

According to the family, the narrative that General Abubakar died as a result of pre-existing health conditions is inaccurate. They maintained that the retired army officer had no known history of diabetes or hypertension and insisted that a snakebite was responsible for his death while in the custody of his abductors.

The disclosure has raised new questions about the circumstances of the retired officer’s final days after he was kidnapped alongside his wife by armed bandits in Katsina State.

Advertisement

General Abubakar and his wife were abducted on May 30, 2026, along the Marabar Musawa–Kafinsoli Road in Matazu Local Government Area while travelling to their hometown.

Following news of his death, the Katsina State Government had announced that the retired military officer died from complications related to diabetes and high blood pressure while in captivity. However, his family has now publicly challenged that account, insisting that the cause of death was unrelated to any underlying medical condition.

The family further clarified that General Abubakar’s wife, who was kidnapped alongside him, has not regained her freedom and remains in the hands of the bandits.

They dismissed reports suggesting she had been released and expressed deep concern over her prolonged captivity.

Advertisement

Family members appealed to security agencies and relevant authorities to intensify efforts aimed at securing her rescue, stressing that the family continues to live in anxiety over her safety.

The death of the retired general has sparked widespread concern across the country, highlighting the persistent threat posed by banditry and kidnapping activities in several parts of northern Nigeria.

The tragic incident also reignited national conversations about insecurity and the safety of travellers on major roads across the region.

Reacting earlier to the retired officer’s death, President Bola Ahmed Tinubu expressed shock and sadness over the development, describing it as a painful loss to the nation.

Advertisement

In a statement issued through his Special Adviser on Information and Strategy, Bayo Onanuga, the President noted that General Abubakar had served the country with distinction during his military career before retiring from active service.

Tinubu also sympathised with the bereaved family, particularly the late general’s wife, who remains in captivity, and extended his condolences to the Katsina State Government and the Nigerian Armed Forces.

The President reaffirmed his administration’s commitment to combating terrorism, banditry, and kidnapping, while insisting that the government would not bow to pressure or demands from criminal groups operating across the country.

As security agencies continue efforts to rescue the general’s wife and other victims held by armed groups, the latest revelations from the family have added a new dimension to the circumstances surrounding the death of the retired military officer.

Advertisement
Continue Reading

News

I risked Abacha’s wrath to push for Abiola’s release, says Abubakar

Published

on

By

ADVERTISEMENT
Zoom Ad
ADVERTISEMENT
Zoom Ad

Former Head of State, General Abdulsalami Abubakar (retd.), has revealed that he made efforts to secure the release of Chief Moshood Kashimawo Olawale (MKO) Abiola long before he became Nigeria’s leader in 1998, despite the risk of being perceived as disloyal to the late General Sani Abacha.

Abdulsalami also disclosed that the whereabouts of the presumed winner of the June 12, 1993 presidential election were so closely guarded during the Abacha years that even senior officials of the regime, including then Chief of General Staff, Lt.-Gen. Oladipo Diya, did not know where he was being held.

The revelations are contained in Call of Duty: An Autobiography of Gen. Abdulsalami Alhaji Abubakar, one of the three books unveiled in Abuja on Saturday during celebrations marking the former Head of State’s 84th birthday.

In the book, Abdulsalami said he quietly engaged some leaders of the National Democratic Coalition (NADECO) after Abiola’s arrest in 1994 in an attempt to find a way out of the political crisis triggered by the annulment of the June 12 presidential election.

Advertisement

“At this point, I need to recount that after Abiola was arrested in 1994, I had, against the grain, made efforts to get him released at the risk of being deemed disloyal by Abacha,” he wrote.

The former military ruler said his efforts were largely unknown to the public because of the sensitive political environment at the time and the perception that any move in support of Abiola could be interpreted as opposition to the Abacha administration.

According to him, one of the most striking aspects of Abiola’s detention was the secrecy surrounding his location, a situation that underscored the tightly controlled nature of decision-making within the military government.

“Before I became Head of State, I didn’t know where Abiola was being detained. Even General Diya, who was second-in-command to Abacha, had no idea where Abiola was being held.

Advertisement

“They kept moving him from one detention centre to another”, Abubakar revealed.

The disclosure appears to reinforce long-held claims that despite his closeness to Abacha and his position within the military hierarchy, Abdulsalami remained outside the inner circle that controlled key political and security decisions during the period.

According to him, Abiola’s detention conditions were so restrictive that members of his family were denied access to him throughout the period, while only his personal physician, Dr. Ore Falomo, was allowed limited contact.

“His family never saw him. It was only his personal physician, Dr. Ore Falomo, that had access to him,” he wrote.

Advertisement

Abubakar said one of his earliest decisions after assuming office following Abacha’s death in June 1998 was to ensure that Abiola’s family was granted access to him.

The move, he revealed, was opposed by some members of his administration who remained uncomfortable with changing the policy surrounding Abiola’s detention.

“When I became Head of State, I insisted that his family must be granted access to him, despite strong opposition from some members of my government,” he wrote.

The former Head of State said many Nigerians failed to appreciate the extent of the internal power struggles he faced after assuming office, noting that becoming leader of the country did not automatically translate into total control of the military and government machinery.

Advertisement

“What many people outside government did not know was that even though I was now in power, there were still different interests in the military and in government.

“I was new in office and needed to consolidate my hold on the system. I needed to be careful and calculated with my actions”, he explained.

Abubakar further stated that despite his access to Abacha during his years in office, he was never part of the core power structure that controlled critical decisions.

“Despite my access to Abacha when he was in power, I was still effectively an outsider in his government.

Advertisement

“Becoming Head of State did not mean I could dissolve the power centres or displace entrenched interests overnight”, he wrote.

The former military ruler said arrangements were subsequently made for members of Abiola’s family to visit him in detention after he assumed office.

According to him, the family travelled to Abuja at his invitation, but internal disagreements prevented all members from seeing the detained politician together.

“One group saw him on the first day, July 6, 1998. The other group was to see him the next day, July 7,” he wrote.

Advertisement

However, that second meeting never took place.

“That was not to be,” Abubakar stated, in an apparent reference to Abiola’s death on July 7, 1998.

Abiola died in custody less than a month after Abacha’s death and shortly after Abdulsalami assumed office, bringing an abrupt end to hopes that the political crisis surrounding the annulled June 12 election could be resolved through his release.

The former Head of State’s account provides a rare insider perspective into the final weeks of Abiola’s detention and the complex web of interests, secrecy and power struggles that characterised one of the most contentious periods in Nigeria’s political history.

Advertisement
Continue Reading

News

At least 30 Yoruba Monarchs Flee Palaces After Bandits Abduct 11th Oba

Published

on

By

ADVERTISEMENT
Zoom Ad
ADVERTISEMENT
Zoom Ad

Following the abduction of another traditional ruler on Saturday, June 13, 2026, over 30 Yoruba monarchs have reportedly fled their palaces in fear for their lives. This latest incident brings the total number of Yoruba obas either abducted or killed by bandits to 11.

Oba Adeniyi Adelana – Baale of Ode Oriya Village, Owo Local Government Area, Ondo State.

Newsmen learnt he was abducted from his residence at about 8:30 pm on Saturday, June 13, 2026, by armed men. His wife was shot in the right hand during the attack .

The Full List of Abducted and Killed Yoruba Monarchs 👇

Advertisement

1. Oba Kehinde Jacob Falodun – Alagamo of Agamo, Akure North LGA, Ondo State

2. Oba Segun Aremu / Oba Olusegun Aremu-Cole – Olukoro of Koro, Ekiti LGA, Kwara State

3. Oba David Babatunde Ogunsakin – Elesun of Esun-Ekiti, Ekiti State

4. Oba Samuel Olatunji Olusola / Oba Olatunde Samuel Olusola – Onimojo of Imojo-Ekiti, Ekiti State

Advertisement

5. Oba Adegoke Adeusi – Olufon of Ifon, Ondo State

6. Baale of Ogbayo – Oke-Ode, Ifelodun LGA, Kwara State

7. Oba Salman Olátúnjí Aweda – Asamu of Olayinka, Ifelodun LGA, Kwara State

8. Oba J.D. Ogunyanda Ilufemiloye / Oba James Dada Ogunyanda – Obalohun of Okoloke, Yagba West LGA, Kogi State

Advertisement

9. Oba Kamilu Salami – Ojibara of Bayagan-Ile, Kwara State

10. Oba Simeon Olaonipekun – Oniwo of Afin, Ifelodun LGA, Kwara State

11. Oba Adeniyi Adelana – Baale of Ode Oriya Village, Owo LGA, Ondo State

Advertisement
Continue Reading

Trending

Copyright © 2024 Naija Blitz News