The Nigeria Extractive Industries Transparency Initiative (NEITI) has thrown its weight behind the proposed 2024 Tax Reform Bill, which is currently under deliberation in the National Assembly.
The endorsement is a significant development in Nigeria’s ongoing efforts to revamp its tax system and strengthen fiscal policy.
NEITI’s position on the Bill was articulated in a detailed memorandum signed by its Executive Secretary, Dr. Ogbonnaya Orji.
The memo was addressed to the leadership of the National Assembly and the Chairman of the Presidential Committee on Fiscal Policy and Tax Reforms, Taiwo Oyedele and posted on X (formerly Twitter) on Tuesday.
Dr. Orji emphasized the transformative potential of the Bill, noting that “The Bill has the potential to modernize Nigeria’s tax system, streamline and broaden its administration and tax base to align with global best practices.”
Orji disclosed that NEITI’s observations followed a detailed review of the draft legislation, which showed extensive research and consultation to produce the innovative provisions currently being deliberated upon.
He highlighted that the proposed reforms would not only improve revenue collection but also enhance transparency and accountability in the nation’s fiscal framework.
Key Features of the Bill
The 2024 Tax Reform Bill is aimed at addressing long-standing inefficiencies in Nigeria’s tax regime. Some of its key provisions include:
- Broadening the Tax Base: Introducing measures to capture previously untapped revenue sources, including the informal sector.
- Simplifying Tax Administration: Streamlining processes to make compliance easier for individuals and businesses.
- Aligning with Global Standards: Incorporating international best practices to attract foreign investments and promote economic growth.
- Enhancing Transparency: Strengthening mechanisms to ensure accountability and curb revenue leakages.
More insights
In October 2024, the National Economic Council (NEC) comprising the 36 state Governors and chaired by the Vice President, Kashim Shettima recommended the withdrawal of the Tax Reforms Bill before the National Assembly at its 145th meeting in Abuja for more consultation with stakeholders.
- This came after the Governors of the 19 Northern states together with traditional rulers and stakeholders from the region voiced their opposition to the bill especially the draft on the derivation-based model of Value Added Tax (VAT) distribution among the federating units in the country.
- In December 2024, President Tinubu directed the Attorney-General of the Federation, Lateef Fagbemi SAN, to work with the National Assembly in addressing “genuine concerns” associated with the Tax Reform Bills before their passage by the lawmakers.
- In January 2025, the Nigeria Governors’ Forum (NGF) opposed any plans to increase the Value Added Tax (VAT) rate in the country.
In a statement signed by the NGF Chairman and Governor of Kwara State, AbdulRahman AbdulRazaq after a meeting with the Oyedele-led committee, the governors emphasized their commitment to comprehensive tax reform while advocating against measures that could exacerbate economic challenges.
