House of Representatives Speaker Abbas Tajudeen has assured Nigerians that the Tax Reform Bills will be thoroughly scrutinized to ensure they align with the nation’s best interests. Speaking at ‘The People’s House Interactive Session on Tax Reform Bills’ in Abuja, Abbas emphasized that the controversies surrounding the bills reflect their importance and the need for healthy debates in a democracy.
The Tax Reform Bills aim to expand Nigeria’s tax base, improve compliance, and establish sustainable revenue streams for development. Key proposals include diversifying the revenue base, promoting equity, and fostering an enabling environment for investment and innovation. However, Abbas noted that taxes should be fair, transparent, and justifiable, balancing public revenue needs with the burdens on individuals and businesses.
Some of the proposed tax reforms include an increment in VAT from 7.5% to 10% by 2025, with further increases to 12.5% from 2026 to 2029, and 15% from 2030 onwards ¹. Other provisions include a 27.5% company tax rate, a 4% development levy on companies, a 5% excise tax on lottery and gaming income, and a 5% telecoms tax.
Abbas stressed that the House has not taken a definitive position on the bills and will carefully consider diverse perspectives, ask probing questions, and seek clarity on unclear provisions. The session aimed to provide a comprehensive understanding of the proposed bills, identify areas needing amendment, and ensure compatibility with the 1999 Constitution and other extant laws.
The Speaker emphasized that tax reforms are crucial for achieving sustainable economic growth and development, and Nigeria’s low tax-to-GDP ratio of 6% must be addressed to reduce reliance on debt financing and ensure fiscal stability.
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