The Arewa Consultative Forum (ACF) has submitted a comprehensive report to the National Assembly, outlining its views and recommendations on the Executive Tax Reforms Bills, ACF’s National Publicity Secretary, Prof. Tukur Muhammad-Baba has disclosed.
The report, which was compiled by a special purpose committee of experts, aims to guide the proposed overhaul of Nigeria’s tax laws, Muhammad-Baba added.
Meanwhile, after weeks of uncertainty, the Senate on Monday – earlier today, February 24 – commenced a public hearing on the tax reform bill.
On Tuesday – toorrow, February 25 – the House of Representatives will open its doors for stakeholders’ input in the controversial bills, which sparked intense debate during plenary two weeks ago before their eventual passage for second reading.
Chairman of the Senate Committee on Finance, Senator Sani Musa, disclosed the Red Chamber’s readiness to commence the exercise, saying, “We have all agreed that we are starting the public hearing on February 24 and 25.”
But in a statement by the ACF’s National Publicity Secretary, Prof. Tukur Muhammad-Baba, released to journalists in Kaduna earlier today, ACF said it had submitted to the National Assembly, the report of the special committee of experts established by the Forum.
“The proposed tax reforms have far-reaching implications for all sections of the country, and not just the North.
“Therefore, we have taken a meticulous approach to studying the bills and providing recommendations that will benefit the nation as a whole,” Muhammad-Baba said.
The ACF report highlighted several key areas of concern, including the proposed increase in the Value Added Tax (VAT) rate. The report recommended retaining the current 7.5 per cent VAT rate, citing the current economic challenges facing citizens and businesses.
“We recognise that the government needs to increase revenue, but we also believe that the current VAT rate is already a significant burden on citizens and businesses,” ACF contended.
“Increasing the rate further could have unintended consequences, such as reducing consumer spending and harming economic growth.”
The report also suggests improving the efficiency of VAT collection, formalising the informal sector and utilising digital technologies to expand Nigeria’s tax base, Muhammd-Baba added.
According to the ACF, these measures could significantly increase revenue without placing an undue burden on citizens and businesses.
In addition, ACF noted that another key area of concern highlighted in the report is the definition of “derivation” and its distribution.
The ACF, according to the Spokesman, recommends clearly defining the term and basing its distribution on consensus reached through consultation with states and local governments.
“The concept of derivation is critical to ensuring that states and local governments receive their fair share of revenue.
“However, the current definition is ambiguous, and we believe that it needs to be clarified to avoid disputes and ensure transparency.”
The report also suggests drastically reducing the powers attributed to the Chief Executive Officer and Chairman of the Board of Directors/Governance of the Joint Revenue Board, Muhammad-Baba highlighted.
According to the ACF, the proposed provisions amount to attributing and concentrating almost absolute powers of supervision and accountability to a single person.
“We believe that this is not in the best interest of the nation, and we recommend that the powers of the Joint Revenue Board be reduced to prevent abuse and ensure accountability,” Muhammad-Baba said.
The ACF report also recommended re-couching Section 69 of the proposed Nigeria Tax Bill to retain TETFUND and NITD.
According to the report, these organisations play critical roles in promoting education and technological development in Nigeria, and their retention is essential to ensuring the nation’s continued progress.
The report suggested allowing records of accounts and preparation of tax returns in local languages, in addition to English.
According to the ACF, this will make it easier for citizens to comply with tax laws and reduce the burden on taxpayers.
Meanwhile, the ACF has distributed its report to various stakeholders, including the Forum of Northern State Governors, traditional rulers, and relevant government agencies.
Muhammad-Baba noted that the organisation in the report encouraged all concerned stakeholders to engage with the National Assembly and contribute to the emergence of robust laws that will stand the test of time.
“We believe that our report provides valuable insights and recommendations that will benefit the nation.
“We encourage all stakeholders to study the report carefully and provide feedback to the National Assembly. Together, we can create a tax system that is fair, efficient, and promotes economic growth and development,” he surmised.
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