Taiwo Oyedele, the Chairman of the Presidential Committee on Fiscal Policy and Tax Reforms, stated that urgent tax reforms are needed to support struggling Nigerians. He responded to concerns from Governor Zulum about the proposed tax bills in the National Assembly, emphasizing the necessity for a 60 percent derivation for equitable VAT distribution. Oyedele highlighted the financial burdens faced by small businesses and urged for timely legislative action to alleviate economic distress across the nation.
Mr. Taiwo Oyedele, Chairman of the Presidential Committee on Fiscal Policy and Tax Reforms, emphasized during an interview with Arise News that urgent tax reforms are necessary to alleviate the struggles faced by many Nigerians. He responded to concerns raised by Borno State Governor, Professor Babagana Zulum, about the need for further consultation regarding proposed Tax Reform Bills currently before the National Assembly. Oyedele asserted that implementing a 60 percent derivation allocation would enhance equity in VAT distribution, which is crucial for fostering economic activity nationwide.
Despite Zulum’s claims that the reform process is hurried and potentially detrimental to Northern Nigeria, Oyedele defended the urgency of the reforms. He pointed out that many Nigerians are enduring significant hardships, emphasizing that small businesses are burdened with numerous taxes and levies—over 60 official and more than 200 unofficial—amidst rising food inflation.
Oyedele stated, “If you want to provide relief for your people, you should do it quickly because it’s urgent. It’s an emergency.” He drew a parallel between the current economic challenges and the global response to the COVID-19 pandemic, highlighting the importance of timely action. Oyedele clarified that the committee has engaged with governors and other stakeholders, having shared drafts of the bills with them, yet there is still a need for prompt legislative review to provide necessary relief to the populace.
In the ongoing discourse, he acknowledged the unexpected resistance from various states, particularly those that were thought to be the beneficiaries of the reforms, and he noted the current debates over the allocation of VAT revenues. This proposed change aims to allow a derivation principle for more equitable sharing of revenue, addressing longstanding disparities. Currently, the VAT revenue allocation includes a 15 percent share for the Federal Government, while states and local governments receive a combined 85 percent share, challenging the efficiency of existing systems and underscoring the need for reform.
The discussion surrounding tax reforms in Nigeria has gained traction due to escalating poverty and economic challenges faced by citizens, particularly in light of high inflation rates impacting food security. Mr. Taiwo Oyedele’s comments arise amid concerns from regional policymakers, especially from northern states, regarding the implications of the proposed tax changes. The National Assembly is currently reviewing the Tax Reform Bills, which include adjustments to the Value Added Tax (VAT) distribution that aim to rectify inequalities among states and support local economic activity.
In conclusion, the urgency of the proposed tax reforms underscores a critical need to address the economic challenges faced by Nigerians. Oyedele’s advocacy for swift action reflects an acknowledgment of the prevailing conditions that necessitate immediate relief measures. The debate surrounding these reforms also highlights regional tensions and the complexities involved in achieving equitable tax distribution, making continued dialogue essential among stakeholders in navigating these challenges.
Original Source: punchng.com
