The Chairman of the Presidential Committee on Fiscal and Tax Reform, Taiwo Oyedele, stated that his committee has submitted approximately ten tax reform bills to the National Assembly for constitutional amendments.
Oyedele made this disclosure in a statement on Tuesday during an interview with Channels TV’s Sunrise Daily.
The chairman of the committee also mentioned that they have drafted entirely new versions of major tax laws in Nigeria, noting that most of the existing laws date back to the colonial era.
He noted that some of the issues identified by the committee necessitated legislative amendments, not just executive orders.
He, however, mentioned that there are about five executive drafts submitted to the President by the committee for his approval.
“As we speak, we have about five draft executive orders. We have a withholding tax regulation that has just been signed by the honourable minister. It’s currently with the Minister of Justice for formatting, gazetting and publishing.
“We also have draft laws. For all our major tax laws, we’ve drafted brand new ones because we took the view that we shouldn’t be amending laws that date back to colonial masters. There is no need to try to amend those. We’ve drafted new ones.
“We have sent about ten amended bills to the National Assembly for constitutional amendments because some of the issues we identified emanated from the constitution itself. We have done a lot of work,” Oyedele said.
Withholding Tax Reform
In an earlier statement, Oyedele said the federal government has approved a new withholding tax system that includes exemptions for farmers, producers, manufacturers, and others.
Oyedele made this disclosure in a statement on his X (formerly Twitter) account on Tuesday.
Oyedele noted that the withholding tax system which was introduced in 1997 served as an advance payment of income tax on specified transactions to grow the government’s revenue.
“Withholding tax was introduced into the Nigeria tax system in 1977 to serve as an advance payment of income tax on specified transactions.
“As the regime expanded over time to cover more transactions, various ambiguities and complications crept in. This resulted in many businesses, especially SMEs, being exposed to an excessive burden of compliance and a strain on the working capital of low-margin businesses.
“As part of the ongoing fiscal policy and tax reforms, a new withholding tax regime has been approved,” Oyedele said.
What you should know
The ongoing tax reform by the federal government began after President Bola Tinubu implemented a tax and fiscal committee headed by Taiwo Oyedele last August.
The committee is saddled with the responsibility to introduce a new tax structure in the country in order to spur economic growth and development.
Accordingly, the committee has proposed different tax reforms including an increase in Value Added Tax (VAX) as well as tax exemptions for low-income earners, among others.
