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Dare Adekanmbi: Understanding Tinubu’s tax bills of reliefs for Nigerians, businesses
Dare Adekanmbi: Understanding Tinubu’s tax bills of reliefs for Nigerians, businesses
The transmission of four bills that aim to overhaul Nigeria’s tax system to the National Assembly two weeks ago by President Bola Tinubu has sparked debates in the polity about the purpose of the bills. Some have expressed fears that the bills may encapsulate proposals calling for a raise in tax rates in a way that will further burden the citizens. Some Nigerians have received the news with mixed feelings, while others have chosen to wait for details before commenting on the development.
There is no basis to entertain any fear about these bills. If anything, Nigerians are going to commend President Tinubu for focusing on laying a solid foundation that will ensure fiscal stability of the country. When Nigerians get to know the details of the in the documents, they will know that the president is actually working to bring reliefs to them and their businesses.
The four executive bills seek to tidy up the fiscal policy and legislation environment in the country. They are: Nigeria Tax Bill, Nigeria Tax Administration Bill, Nigeria Revenue Service (Establishment) Bill, and Joint Revenue Board (Establishment) Bill. These bills seek to translate the recommendations by the Presidential Committee on Fiscal Policy and Tax Reforms, chaired by Taiwo Oyedele, into implementable legislative framework for the benefits of Nigerians.
It is common knowledge that one factor which has continued to impede efficiency in Nigeria’s tax system and has negatively impacted revenue is multiplicity of taxes. President Tinubu, in his inauguration speech, had pledged to address the issue of multiple taxation and remove all hurdles against investment in the country. Multiplicity of taxes is one of the issues that the Nigeria Tax Bill seeks to end. This will certainly bring reliefs to corporate Nigeria. Imposition of tax by more than one agency or level of government, without a shadow of doubt, constitutes a chokehold on businesses, especially micro and small businesses as well as individuals.
How will this bill address multiplicity of taxes? In Nigeria today, laws dealing with various aspects of taxation are scattered in different legislations. Some of these laws are: Companies Income Tax Act, Personal Income Tax Act, Capital Gains Tax Act, Value-Added Tax Act, Stamp Duties Act, Petroleum Profits Act, Tertiary Education Fund Act, Petroleum Industry Act and so on. In addition to the tax-specific laws, there are plethora of tax provisions in non-tax laws such as the NLNG Act, Tertiary Education Trust Fund Act, NASENI Act, Lottery Act, Companies and Allied Matters Act, etc. The list is seemingly endless.
In enforcing these disparate tax provisions, unintended multiple taxation occurs and this is one of the things that the bill seeks to address. The Nigeria Tax Bill aims to codify of all taxing provisions into one single document to be known as the Nigeria Tax Act when passed into law. In the bill, chapters are devoted to the various tax types in a simplified format. The proposed tax law is also written in a simple language that anyone with basic literary education can read and understand. The complexity of the extant law, for instance, is such that it will be pretty difficult for a Professor of Mathematics to compute his personal income tax on his own because of all the inter-twinning provisions that will befuddle him as to what income is taxable or what deduction is allowable. All these complications and complexities have been removed in the new proposals.
In the proposed law, companies doing businesses within the country have been re-classified into two: small and large. This is done in accordance with the companies’ respective turnover thresholds. A company will be deemed small if its turnover is N50m or less in a year. Under the extant law, any company which records a turnover of N25m or less is not required to pay Companies Income Tax (CIT). In the new tax bill, companies with yearly turnover that is up to N50m will not pay CIT. As regards large companies, that is, those whose turnover thresholds are above N50m, there is a proposal in the bill to give some relief to them. The objective of this succour for such companies is in line with President Tinubu’s avowed commitment to protect small businesses and eliminate inhibitions that negatively impact entrepreneurship in the country.
Perhaps the game-changer among the several pleasant provisions of this document is what the bill seeks to do with VAT. It is an eloquently testimony to the fact that President Tinubu has listened and harkened to the complaints by Nigerians, particularly the ordinary Nigerians who are bearing the substantial brunt of the initial pain of the government’s economic reformation policies. In the proposed law, VAT will not be charged on all items that have direct existential impact on the common people. Items such as food, medicals, education, transport business and agriculture are not chargeable to VAT. For instance, tuition fee or rent paid by proprietors or purchases made by school owners for the purpose of the business of educating Nigerians will be free from VAT. It is the same for owners of hospitals, those in agricbusiness as well as those who buy vehicles for transportation. These are the areas where the lives of the common people will be significantly positively affected, especially in view of the temporary pain of the ongoing reforms.
In addition, certain input VAT which hitherto is not possible to claim under the current law can now be claimed. Another relief the president has put in the bill is that for VAT refunds will be made within 30 days upon completion of paper work by the such companies or entities. Already VAT is not being charged on diesel and petrol. The president had in July this year directed the suspension of duties, tariffs and taxes on importation of food commodities as part of measures to arrest the rising cost of living.
It may interest many to know that VAT rate of 7.5% currently being charged in Nigeria is the lowest on the continent and one of the lowest in the world. Madagascar and Morocco charged 20% VAT in 2022, while it is 19.25% in Cameroon. Many countries of the world, recognising the importance of tax revenue in providing public services, have this year reviewed their VAT upwards with one of the most striking examples being Saudi Arabia which upped its rate from 5% to 15% in July.
Further to the Nigeria Tax Bill, the table of tax rates for individuals has been restructured in a way that brings huge respite to low-income earners. It is worth mentioning that the Federal Inland Revenue Service (FIRS) does not collect taxes from individuals. It is within the jurisdiction of states’ revenue authorities to collect such income tax from individuals. The only set of individuals who pay personal income tax to FIRS are members of the Armed Forces, members of the diplomatic corps and foreigners earning income in Nigeria. In the new bill, individuals whose annual income is N800, 000 after the deductions of pension and deductible items will not be required to pay personal income tax (PAYEE). However, the elite who earn fat annually will pay more. This is in line with the global principle of progressive taxation which takes more tax from the high earners and a little lower tax from middle earners, while low income individuals pay very little. The pledge of Mr President is that his administration’s fiscal policy will tax prosperity and not poverty.
The second bill, the Nigeria Tax Administration Bill, basically seeks to consolidate administrative provisions for all taxes. This bill harmonises all tax administration issues such as registration, filing, payment, dispute resolution, etc for all tax-types and revenue authorities. It also clearly delineates the roles and objectives of all tax authorities in the country as well as their relevant jurisdictions. The aim of this bill is to promote the ease of tax administration, lessen tax compliance burden on the citizens and improve the ease of doing business in the country.
As for the proposed Joint Revenue Board (Establishment) Bill, this is seeking to replace the Joint Tax Board (JTB) which has been wobbly since its establishment because it was built on quicksand. The proposed replacement not only addresses the glaring shortcomings in JTB, but also retains the joint control of the body by the federal and state governments. It also seeks the creation of the office of Tax Ombudsto resolve all complaints that may arise from the operations of JRB.
Today, we cannot run away from the cryptocurrency ecosystem because it is the in-thing. But as it stands in Nigeria today, there is no law that regulates cryptocurrency operations. One key highlight of the Nigeria Tax Bill is that it seeks a legislation to regulate the digital currency market said to be worth $1trillion globally. The bill, when passed into law, will arrest the revenue the country has haemorrhaged in the sector. It will be recalled that some executives of one of the biggest cryptocurrency platforms, Binance, are in court for non-payment of taxes among other offences.
The Nigeria Revenue Service (Establishment) Bill is primarily proposing a change of name for the Federal Inland Revenue Service (FIRS) to the Nigeria Revenue Service. This bill is one which seeks to correct the error of 2007 when Nigeria’s apex tax authority, FIRS, became autonomous as an operational arm of the Federal Board of Inland Revenue (FBIR). The mandate of FIRS is to administer tax laws to assess, collect and account for revenue accruable to the federation and not the Federal Government. Especially when we consider the current sharing formula on VAT revenue, only 15% goes to the Federal Government. The remaining 85% is shared between the states and the local government areas.
Today, tax revenue from FIRS is the main reason the 36 states and the local government councils smile to the banks monthly during their Federation Account Allocation Committee (FAAC) meeting. A total of N17.8trillion accrued to the Federation Account between January and July this year. FIRS tax revenue alone contributed N11.7trillion, representing 65.8 percent of the total money disbursed to the federal, state and local government councils to meet their needs.
Giving such a critical agency an appellation which suggests it is collecting tax solely for Federal Government is improper and must be corrected. Another error in the current name is contained in the word ‘Inland’ which restricts the agency to the collection of taxes within the interior territory of the country. Nigeria has huge revenue to collect from offshore transactions and only a repeal of FIRS (Establishment) Act 2007 to pave the way for the Nigeria Revenue Service (Establishment) Act can make that happen. Those suggesting that the proposed name change will translate to other revenue agencies being subsumed or merged with NRS need to get copies of the bill to clear their doubt.
The general principle of the four tax bills is not just to modernise the tax system in the country, but also to ensure that relief is created for ordinary Nigerians and businesses. And so, for insulating the poor from VAT payment through exemptions of good and services that directly impact their lives, for making VAT neutral for businesses through enabling deduction of input tax from out VAT, President Tinubu has demonstrated fidelity to his commitment that government policies must allow the poor to breathe and not suffocate. Tinubu deserves to be applauded as a leader who listens to the yearnings of the citizens.
Dare Adekanmbi is the Special Adviser on Media to the FIRS chairman.
TINUBU IS THE WISEST MAN EARTH -PROPHET IKURU.
by Collins Nkwocha
Nigerian prophet, prophet Godwin Ikuru of Jehovah Eye Salvation Ministry, Lagos magnetized everyone’s attention when he referred to the president, Bola Ahmed Tinubu as the wisest man on earth regarding the appointment of Daniel Bwala as special Adviser on policy communications.
Speaking to reporters today in Lagos,
Prophet Ikuru applauded the president for choosing him and enunciated that he’s capable of delivering effectively and marketing the Renewed Hope Agenda of the president and urged Nigerians to stop the criticism because of what he said in the past “I’m personally happy with his appointment and I urge Nigerians to forget about the past, forget about what he must have said about the president some years ago which people are now disseminating on the social and taunting him a betrayal that lacks integrity, Nigerians should forget his past because he’s the best choice”.
Prophet Ikuru insisted that Bwala saw the sincerity and genuity of the president’s Renewed Hope Agenda and he decided to partake in it “even if he criticized the president, it was in the past, he saw the sincerity in the Renewed Hope Agenda and decided to join in nation building ,the president is ready to unite everyone in order to build Nigeria,that’s why someone like Wike is in his government,Bwala has what it’s required to be successful under Mr.president, as a wise man, the president saw it and decided to harness it ”
Finally, he praised Tinubu and referred to him as a great leader who is ready to involve everyone in his government, he maintained that his wisdom is magnanimous ,Baba is truly the wisest man on earth.
U.S. Courtroom Shock: Funke Ashekun, Husband Collapse as MFM Wins
Had FFK Faced Mehdi Hassan, Nigeria Would Have Spoken With Fire
By Mohammed Bello Doka
In politics, timing is everything. In diplomacy, character is everything. And in moments of national importance, leadership must be entrusted to individuals who possess not only experience but courage, intellect and an unshakable commitment to the nation they represent.
It is for this reason that the appointment of Chief Femi Fani-Kayode as Nigeria’s Ambassador to a foreign nation stands out as one of the most consequential diplomatic decisions in recent years.
Chief Femi Fani-Kayode, better known in the South as “FFK” and in the North as “Sadauki”, is one of the most brilliant, experienced, accomplished, vocal, respected, educated, profound, intellectual, patriotic, disciplined, well-read, historically literate, versatile, forceful, persuasive, sophisticated, cosmopolitan, charming, eloquent, courageous and resilient men in Nigerian politics and he has paid his dues and proved his worth over the last 35 years in politics and political discourse.
In each role he has played he has excelled and succeeded even when he was in opposition.
His friends value him as a great and loyal defender and his traducers and political adversaries fear and respect him because when he goes to war he is utterly relentless, takes no prisoners and literally spits fire.
How I wish it was him that was interviewed by Mehdi Hassan of Al Jazeera and not the young and inexperienced Daniel Bwala because he would have not only humbled Hassan but also done Nigeria proud.
He played Bwala’s present role in the Presidential Villa 23 years ago as President Olusegun Obasanjo’s spokesman and not only brought the then President’s domestic enemies to their knees but also had a series of very hot exchanges with foreign Government officials like America’s Under-Secreatary of State for Africa Jendaye Fraser and the White House over the Charles Taylor issue and Liberia.
Tinubu decision to appoint him as an Ambassador for our nation was a wise one because he will fight for and protect the interests of Nigeria and the Nigerian community whetever he goes and will never sell his soul or bow to foreign imperialist interests.
His appointment is not about just rewarding loyalty for the key role he played in Tinubu’s presidentiel campaign organisation as Director of New Media and Special Operations in 2023 and the staunch support he has given the President over the last three years but also about putting a square peg in a square hole.
If you want to put Nigeria first Sadauki is the one to do it.
If he runs the Nigerian Mission in the country that he is sent to in the same way he ran the Ministry of Culture and Tourism and the Ministry of Aviation when he was Minister to each of them one after the other twenty years ago he will do very well and both our nation and whichever nation he is posted to itself will benefit from his efforts.
History teaches that diplomacy is most effective when nations deploy individuals who possess both intellect and courage.
As the American statesman Henry Kissinger once noted, “Diplomacy is the art of restraining power.”
To do so successfully requires deep historical awareness and strategic clarity—qualities that have long defined Fani-Kayode’s political career.
Sending a politically seasoned voice like FFK to any nation that is a key partner to Nigeria signals that Bola Ahmed Tinubu intends to strengthen Nigeria’s diplomatic posture with confidence.
Throughout more than three decades in the political arena, Fani-Kayode has remained one of the most resilient and outspoken figures in Nigerian public life despite numerous challenges which would have broken and destroyed lesser men.
Regardless of all that was thrown at him he continues to pull through and come out victorious which is why many refer to him as the “Akanda Eledumare” and the “Ayanfe Oluwa” which mean “the strange one of God” and “the beloved of the Lord”.
There appears to be a divine dimension to his life that makes him unstoppable and irrepressible even though his enemies are legion.
One wonders what sets him apart and makes him so different.
There is no doubt that his education played a part in it and this set him apart from most.
He never went to school in Nigeria but was educated from the age of eight in England starting off at Holmewood House School in Kent, one of the UK’s best and most famous Preparatory schools, after which he attended the famous Harrow School just outside London which is, together with Eton College, an institution that is the exclusive preserve of high society in the UK, one of the two best private schools in that country where only the ruling elite, the rich, the well-to-do, the famous and only a tiny proportion of those in British high society can afford or even qualify to attend.
No less than eight British Prime Ministers, including the great Sir Winston Churchill, and countless British cabinet ministers attended Harrow and so did many leaders, diplomats and top politicians from many foreign countries.
After finishing at Harrow he attended some of the top universities in the world, including London University (SOAS) and Cambridge University (Pembroke College) where he did so well.
As a matter of fact his great grandfather, Rev. Emmanuel Adelabi Kayode, attended Furrough Bay College which at that time was part of Durham University and graduated with an MA (Hons.) in Theology in 1893. His grandfather Justice Adedapo Kayode attended Cambridge University (Selwyn College) where he studied law and graduated in 1922. His father Chief Remilekun Fani-Kayode attended Cambridge University (Downing College) where he studied law and graduated in 1943. Sadauki himself graduated in law at Cambridge University (Pembroke College) in 1984 whilst his daughter Folake Fani-Kayode graduated from Durham University in 2009.
No African family has an uninterrupted streak of 116 years of Oxbridge-level university graduates except for the Fani-Kayode’s which is something that both his family and every patriotic Nigerian should be proud of.
It therefore makes perfect sense that a man from such a distinguished pedigree and intimidating lineage and that has such an extraordinary intellectual heritage should represent Nigeria on the international stage.
There is also his role in the debate on Gaza which made him a hero in the eyes of millions of people in the Global South both amongst Christians and Muslims.
He spoke out consistently about what he described as the genocide being committed against the Palestinians and he was prepared to put his life and career on the line for this cause even though most Nigerian leaders and politicians refused to say what he was saying publicly out of fear of the Zionist lobby and the Jewish state.
His sense of patriotism is unquestionable and nothing reflects this better than his series of essays written against Kemi Badenoch, the leader of the British Opposition Conservative Party and his write up against one Ben Llewelyn-Jones, who at that time was the Deputy British High Commissioner to Nigeria, when the former consistently sought to insult and denigrate Nigeria and the Nigerian people and the latter attempted to interfere in our internal affairs by making statements in support of Peter Obi and his Obidients in the 2023 presidential elections.
Sadauki successfully put them both in their place and when American Senator Ted Cruz, President Donald Trump, Congressman Tim Riley and other American politicians began to peddle the false narrative and fake gospel of Christian genocide and persecution in Nigeria Sadauki, a devout Christian himself, rose to the challenge and more than any other Nigerian wrote about the issue in a series of essays pointing out the fact that as many Muslims were being killed as Christians by the terrorists in our country and that Christians were not being persecuted by our Government and are in fact faring better when it comes to positions in the security apparatus and governance under Tinubu than they did in the previous administration.
He also spoke out boldly against President Trump and his administration when they accused the Government of South Africa of indulging in genocide against the white minority population in their country and pointed out the fact that South Africa, like Brazil, was a shining example of a successful multi-ethnic, multi-religious and multi-cultural nation that was treating its white minority population with the greatest respect. Few Africans said a word to defend South Africa at the time even though they knew that Trump was wrong but Sadauki did so without thinking twice.
He is clearly a strong Pan-Africanist and a believer in the importance of the African Union, African solidarity, the BRICS coalition and the Global South alliance comprising of China, Russia, South Africa, India, Saudi Arabia, Turkey and other emerging world powers.
This is commendable and it reflects his courage and disdain for those that display ignorance, disdain and contempt for our nation and people and that seek to denigrate and misrepresent us.
Sadauki is not the type that bows and quivers before Westerners like so many other Nigerian leaders and politicians but rather takes pride in his Nigerian culture, race, heritage and identity and is prepared to defend us and speak for us no matter whose ox is gored and who is involved.
In an increasingly competitive global environment, Nigeria requires diplomats capable not only of negotiation but also of defending national interests with conviction.
If the energy, eloquence and intellectual fire that have defined Fani-Kayode’s political life accompany him to the country to which he has been posted, his tenure may well become one of the most consequential chapters in Nigeria’s modern diplomatic engagements.
I wish him well and I thank God that he is back in the saddle of public office after so many years.
What more could any of us ask of this great and noble son of Nigeria?
This is undoubtedly the quality of personnel and leaders that we need on the international stage.
I hope and pray that in his endeavours and during the course of his work he meets with Mehdi Hassan in a debate and prove to him and the rest of the world that Nigeria still has men that can not only match them but that can also remove their trousers in any verbal encounter. Bwala put us to shame but FFK can redeem us before the eyes of the world.
(Mohammed Bello Doka, the author of this essay, is the publisher of Abuja Network News and can be reached via [email protected])
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