The House of Representatives has set up a special committee to conduct public hearing on the four tax reform bills, which passed second reading last week.
The committee, which is chaired by the chairman, House Committee on Finance, James Faleke, will consist of the chairmen of the various caucuses and members of the finance committee, amongst others, is expected to hold a public hearing on the bills next week.
The House had approved the four bills for second reading, last Wednesday, after a debate on the general principles of the proposed legislations, which lasted for over three hours.
The proposed legislations, which were transmitted to the National Assembly by President Bola Tinubu on October 3, 2024 include: The Joint Revenue Board of Nigeria (Establishment) Bill, 2024, The Nigeria Revenue Service (Establishment) Bill, 2024, The Nigeria Tax Administration Bill, 2024 -and the Nigeria Tax Bill, 2024.
The bills, which were earlier trailed by controversies and protests by Northern elders and state governors, are intended to reform tax administration in the country.
The key provisions of the tax reform bills are increase in Value Added Tax ( VAT) and the distribution of revenue to the states.
Section 146 of the Nigeria Tax Bill provides for an increase in VAT from the current 7.5 percent to 10 percent in 2025, 12 . 5 percent in 2026- 2029 and 15 percent in 2030.
Also, Section 77 of the Tax administration bills states that revenue accruing from VAT shall be distributed on to the three tiers of government as follows: Federal Government- 10 percent; state government- 55 percent and local government 35 percent, “provided that 60 percent of the amount standing to the credit of states and local governments shall be distributed among them on the basis of derivation.”
