Senate to Debate Tax Reform Bills Today, With Potential for Second Reading
The Nigerian Senate is set to debate the Tax Reform Bills today (Thursday), with the possibility of passing them for a second reading. The announcement was made by Deputy Senate President, Jibrin Barau, during Wednesday’s plenary, where he revealed that experts would present and guide the discussion on the bills.
The presentation will be led by the Chairman of the Presidential Committee on Fiscal Policy and Tax Reforms, Taiwo Oyedele, along with other key figures such as the Chairman of the Federal Inland Revenue Service (FIRS), Zacchaeus Adedeji, and Director General of the Budget Office, Tanimu Yakubu. The team will provide detailed explanations on the bills, which President Bola Tinubu had forwarded to the National Assembly in October.
Oyedele’s presentation provided key highlights of the proposed reforms, which include harmonizing major taxes into a single legislation, simplifying tax processes, and proposing exemptions for low-income earners. Some key proposals include eliminating minimum taxes for loss-making companies, introducing a 15% effective tax rate on large company profits, removing VAT on essential goods and services, and increasing tax thresholds to exempt low-income earners.
On the controversial revenue-sharing formula for VAT, Oyedele emphasized that the current distribution is unfair, as it disproportionately favors states with corporate headquarters, like Lagos. The proposed reform aims to base VAT distribution on consumption within states.
Debate and Tensions in the Senate
During the lead-up to the presentation, there were some procedural disagreements. Senate Leader Bamidele Opeyemi moved to suspend Senate rules to allow the economic team to enter the chamber and present the bills. However, Senator Abdul Ningi (PDP, Bauchi Central) objected, suggesting that such discussions should be held at the committee level. Despite this, Deputy Senate President Barau clarified that suspending the rules allowed for transparency, enabling Nigerians to follow the live proceedings.
Senator Ali Ndume (APC, Borno South) raised concerns about the matter not being listed on the Order Paper, suggesting it be deferred to another legislative day. However, Barau dismissed the objection, urging the Senate to focus on the substance of the discussion rather than procedural concerns. Tensions escalated when Ndume expressed dissatisfaction with Barau’s remark, demanding an apology, but the Deputy Senate President clarified that his comment was not intended as an insult.
Following these exchanges, the economic team was allowed to present the tax reforms, and Barau confirmed that the Senate would continue with the debate the following day. He assured lawmakers that the second reading was just the beginning of a long process, including public hearings and committee reviews, where concerns could be addressed.
