For the records: Address of LND chair at the public presentation of overview of tax reform bills
Overview of the Tax Reform Bills Submitted by President Bola Tinubu being the address of Sen. Ibrahim Shekarau, chairman, League of Northern Democrats, at the public presentation, Abuja, Thursday, 19th December, 2024
Ladies and gentlemen,
2. It is an honor to present the subject matter of the Tax Reform Bills submitted to the National Assembly by President Bola Tinubu, as reviewed by the League of Northern Democrats’ (LND) Technical Committee.
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3. As you can remember, two weeks ago, LND set up a technical committee comprising of experts in taxation, fiscal policy, legislation, academics and law. The committee did a good job of analyzing the bills and the key principles underlying them, and made its preliminary submission and recommendations. It is this submission that LND adopted as its position with regard to the president’s tax reform initiative. This submission is what we are about to make public presentation shortly in this hall as our business of day.
4. The proposed tax reform initiative of the president is a bold attempt to address Nigeria’s long-standing challenges with fiscal inefficiency, a narrow tax base and inequities in revenue generation and allocation. Collectively, the four bills seek to broaden the tax base, simplify compliance, improve revenue collection and strengthen fiscal federalism. These reforms, if properly implemented, have the potential to transform Nigeria’s economy, unlocking opportunities for growth and development.
5. However, while tax reform is undoubtedly overdue, the bills have raised significant concerns, which must not be ignored. Key issues include:
i. Equity and Burden Distribution: Questions about whether the proposed measures ensure fairness in taxation, particularly for small businesses and lower-income groups;
ii. Implementation Feasibility: Concerns about the capacity of tax authorities to efficiently implement and monitor the new provision;
iii. Impact on the Informal Sector: The potential risks of alienating informal sector participants through overly aggressive taxation policies;
iv. Revenue Allocation: Whether the reforms adequately address the imbalance in revenue sharing between federal, state, and local governments; and
vi. Risk of Over-Taxation: The danger of stifling economic activities by overburdening businesses and investors.
6. The LND believes that if these concerns are effectively addressed, the tax reforms could position Nigeria’s economy for sustainable growth and fiscal stability. However, if these critical issues are overlooked, the country risks facing catastrophic economic, social, and political consequences that could further deepen existing challenges.
7. We urge all stakeholders to engage constructively with these bills, ensuring that they are refined to reflect the realities and aspirations of all Nigerians. As we delve into the Technical Committee’s detailed report, we hope to shed more light on the way forward for these crucial reforms.
8. I wish us fruitful deliberations. Thank you.
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