The House of Representatives has retained Value Added Tax (VAT) at 7.5%, rejecting a proposed gradual increase to 15% by 2030. The House also dismissed a proposal to reintroduce inheritance tax under the guise of taxing family income.

Submitting the report during plenary in Abuja, the Chairman of the House Committee on Finance, Rep. James Faleke, stated that the report represents a comprehensive review of the bills, incorporating extensive public input.

The report covers four key bills aimed at overhauling Nigeria’s tax framework:

Nigeria Tax Bill

Nigeria Tax Administration Bill

Nigeria Revenue Service (Establishment) Bill

Joint Revenue Board (Establishment) Bill

Key Amendments in the Tax Reform Bills

Nigeria Revenue Service (NRS) Bill

Redefined Scope: The NRS will now focus on federal-level revenue collection, excluding individual taxpayers in states and the Federal Capital Territory (FCT).

Board Composition: Section 7 now requires six executive directors, each appointed by the president from the six geopolitical zones on a rotational basis. Each state and the FCT will also have a representative on the board.

Secretary Qualifications: Section 13 mandates that the Secretary to the Board must be a lawyer, chartered accountant, or chartered secretary at the level of Assistant Director or higher.

Fixed Funding Rate: The NRS will now receive a 4% cost-of-collection rate (excluding royalties), subject to National Assembly approval.

Borrowing Powers Restricted: Section 28 now requires Federal Executive Council (FEC) and National Assembly approval before the NRS can secure any loans.

Joint Revenue Board (JRB) Bill

Tax Appeal Commissioners’ Criteria Revised: Section 25 removes the requirement that commissioners must have business management experience, as the Committee deemed it irrelevant.

Strengthened Tax Ombud’s Independence: Section 43 mandates that the Tax Ombud’s Office be funded directly from the Consolidated Revenue Fund, eliminating reliance on external donations.

Independent Funding for Tax Appeal Tribunal (TAT): The tribunal will now operate independently of the Federal Inland Revenue Service (FIRS) to prevent conflicts of interest.

Stricter Adherence to the Evidence Act: New rules ensure that tax appeal proceedings strictly follow the Evidence Act.

Taxpayer Identification Number (TIN) Processing: The timeline for issuing TINs has been extended from two working days to five to accommodate administrative delays.

Faster Tax Returns for Ceased Operations: Companies ceasing operations must now file income tax returns within three months, down from six months, to prevent revenue loss.

VAT System Adjustments: Section 22 ensures that taxable supplies are attributed to their place of consumption, addressing regional imbalances.

VAT Fiscalisation System: Section 23 introduces a new regulatory framework to improve VAT collection.

Increased Reporting Thresholds for Banking Transactions:

Individuals: ₦25 million → ₦50 million

Corporate Entities: ₦100 million → ₦250 million

Judicial Oversight on Asset Seizure: Section 60 mandates that tax authorities must obtain a court order before seizing movable assets.

Mandatory Electronic Taxpayer Records Access: Section 61 formalizes the government’s right to access electronically stored tax records in line with modern practices.

New VAT Revenue Distribution Formula:

70% distributed equally among local governments

30% based on population

General Amendments Across Tax Bills

VAT Rate Maintained at 7.5% – The Committee rejected the proposal to gradually increase VAT to 15% by 2030.

Petroleum Gains Tax Reduced to 30% – Section 78 revises the tax rate on petroleum gains from 85% to 30%.

Excise Duty Provisions Removed – Excise duty-related provisions were deleted due to concerns about their negative economic impact.

Higher Turnover Threshold for Small Companies: A business will now be classified as a small company if its annual turnover is ₦100 million or less (asset cap remains at ₦250 million).

New Penalties for Virtual Assets Service Providers (VASPs): Stricter fines and potential license suspensions for non-compliant crypto and digital asset businesses.

While submitting the report, Rep. Faleke highlighted the importance of the tax reform bills in modernizing Nigeria’s tax system, boosting revenue collection, and fostering economic growth.

“These Bills are critical to implementing a modern, transparent, and efficient tax system that will support economic growth and improve revenue collection,” he said.

He added that the review process was extensive, incorporating input from the public and key government agencies, including:

Nigeria Export Processing Zones Authority (NEPZA)

National Agency for Science and Engineering Infrastructure (NASENI)

National Information Technology Development Agency (NITDA)

Tertiary Education Trust Fund (TETFund)

“We carefully examined every submission to ensure that public opinion was reflected in our recommendations. This process involved a thorough review of existing laws proposed for repeal or amendment,” Faleke noted.

The amendments impact key laws, including:

Companies Income Tax Act (CITA)

Value Added Tax Act (VAT Act)

Personal Income Tax Act (PITA)

Federal Inland Revenue Service (Establishment) Act

Petroleum Industry Act

Nigeria Export Processing Zones Act

Oil and Gas Free Trade Zone Act

The House of Representatives is expected to deliberate on the report in the coming weeks as part of its legislative process.

Malam Nasir El-Rufai, the former governor of Kaduna State, has revealed that he knows individuals who paid for ministerial positions in President Bola Tinubu’s All Progressives Congress (APC) government.

In an interview with BBC Hausa, El-Rufai clarified that his departure from the party was not due to his ministerial ordeal but because the APC had drifted from its founding ideals. He explained that if the party had sacked him, it would have spared him the stress of explaining his exit. According to him, it wasn’t he who left the APC, but rather, the party had abandoned him and its original principles.

“It could have been easier for me if APC sacked me because they would save me from explaining the stress of why I left the party,” El-Rufai said.

When asked whether he thought people might believe he left due to not being appointed as a minister, El-Rufai confidently responded, “Did I seek to be minister? I know people who paid to get ministerial appointments.”

Although El-Rufai did not regret supporting Tinubu’s presidential campaign, he expressed his disappointment with how he had been treated. He further criticized the APC for becoming a party where personal interests overshadow the original vision, making it difficult for those who worked hard for its success to be acknowledged or rewarded.

“The APC has abandoned the ideals that led to its formation. It has abandoned the people. Everyone is now pursuing personal interests and wealth. The government has become a business enterprise where everything has a price,” he said.

El-Rufai also pointed out that key appointments in the current administration are being controlled by a select group from Lagos, reinforcing his belief that fairness and justice have been sidelined within the party.

“There is no justice. Those who worked for the party are not recognised, let alone rewarded. Appointments are now controlled by a select group from Lagos. The party is dead,” El-Rufai concluded.

Before making the decision to leave the APC, El-Rufai consulted several political figures, including former President Muhammadu Buhari, Tunde Bakare, Abdullahi Adamu, Adams Oshiomhole, and Bisi Akande, to seek their opinions on his situation.

Former President Olusegun Obasanjo has said that most Nigerians are only interested in using public offices to enrich themselves and their cronies and then leave the country worse than they met it.

The former President said these people obtain billions of naira in loans, believing that paying back from public funds after being elected won’t be a problem.

Obasanjo disclosed this in his new book, ‘Nigeria: Past and Future’ where he painted the characters of chief executives at both the federal and state levels.

The book was one of two new books unveiled to mark Obasanjo’s 88th birthday last week.

The former President said the majority of those who have been opportuned to hold leadership positions in the country such as governors, presidents, ministers, commissioners and local government chairpersons, were ill-prepared, satanic, self-centred and were all out to corruptly enrich themselves while the nation continues to wallow in abject poverty and condemnable underdevelopment.

Obasanjo said that many clamouring to be governors or lead the country in one form or the other are only interested in using their offices to enrich themselves and their cronies and then leave the country worse than they met it.

He said, “How do you explain the situation of a chief executive, a governor, whose business was owing the banks billions of naira and millions of dollars before becoming a governor and within two years of becoming governor, without his company doing any business, he paid all that his businesses owed the banks.

“You are left to guess where the money came from. Having got away with that in the first term, he consigned to himself almost half of the state resources in the second term. He was a typical example of the goings-on at that level almost universally in the country with only a few exceptions.

“State resources are captured and appropriated to themselves with a pittance to staff and associates to close the mouths of those that could blow the whistle or raise alarm against them while in office and when they are out of office.’’

He further said, “The ones that are criminally ridiculous are the chief executives that deceive, lie and try to cover up on the realities and truth of action and inaction on contract awards, agreements, treaties, borrowings and forward sales of national assets. Such chief executives are unfit for the job they find themselves in.”

Speaking on the N15.6tn Lagos-Calabar Coastal highway project, the former President described it as wasteful and corrupt.

Minister of Works, David Umahi, had revealed that the 700km Lagos-Calabar Coastal Highway will cost N4.93bn per kilometre, stating that the contract was awarded on a counterpart-funding basis and not a Public-Private Partnership.

About N1.06tn has been released for the pilot phase, or six per cent of the project, which begins at Eko Atlantic and is expected to terminate at the Lekki Deep Sea Port.

Many prominent Nigerians, including the presidential candidate of the Peoples Democratic Party in the 2023 general elections, Atiku Abubakar, have questioned the Federal Government’s decision to award the contract to Gilbert Chagoury’s Hitech Construction Company without competitive bidding.

Chagoury is believed to be Tinubu’s long-time business partner and friend.

Assessing the two years of President Bola Tinubu-led administration, Obasanjo said it appears that the game of short-changing the over 230 million Nigerians would continue because “everything is said to be transactional and the slogan is ‘it is my turn to chop.’’

“Typical examples of waste, corruption and misplaced priority are the murky Lagos-Calabar Coastal Road on which the President had turned deaf ears to protests and the new Vice-President’s official residence built at a cost of N21bn in the time of economic hardship to showcase the administration hitting the ground running and to show the importance of the office of the Vice-President. What small minds!”

He equally slammed the federal government for spending N21bn on a new official residence for Vice President Kashim Shettima, calling it a misplaced priority and conduit designed to embezzle public funds.

To address some of the challenges facing the country, the former President said that there is a need to interrogate the Western liberal democracy being practised and see how it could be reviewed to reflect African peculiarities.

“If the West, from where the liberal democracy started should complain about it not working well for them, we should be wise enough at this stage to interrogate, carry out introspection, internal analysis and realise that Western liberal democracy is not working for us and is not delivering apart from the shortcomings of the operators.

“We should seek democracy within African history, culture, attributes and characteristics, one that will take necessary African factors into consideration. Until we can get a better word or description for it, let us call it Afrodemocracy.

“It is from Afrodemocracy that we will draw up an African people’s constitution for any African that chooses to go the way of Afrodemocracy, which will avoid most, to all, the faults we have found in Western liberal democracy,” he suggested.