Tinubu plans to bar Customs, NPA, others from revenue collection

President Bola Tinubu may bar revenue-generating agencies from collecting revenues on behalf of the Federal Government as he plans to introduce a single agency – Nigeria Revenue Service – to handle the task.

This came as the Federal Government instituted a comprehensive set of fresh tax reforms aimed at significantly boosting revenue collection.

The reforms, designed to enhance the efficiency of collecting direct taxes, along with various levies that are imposed on behalf of the government, will bar the Nigerian Customs Service, Nigerian Ports Authority, and 60 other revenue collection agencies from participating in revenue collection activities, but will lead to the creation of the Nigeria Revenue Service.

By implementing these changes, the government seeks to streamline the tax collection process, ensuring that all taxable entities contribute their fair share and that the revenue generated is maximised to support public services and infrastructure development.

The policy directive was instituted on Thursday when the President forwarded four executive bills to the National Assembly for consideration, aiming to implement significant tax reforms.

Nigeria is contending with a revenue challenge that cuts across all government tiers but wants to attain a minimum tax-to-GDP ratio of 18 per cent. The country’s tax-to-GDP ratio is below Africa’s average and ranks as one of the lowest in the world.

This has led to fiscal deficit and over-reliance on borrowing to finance public spending resulting in a cycle of inadequate funding for socio-economic development.

In addition to the name change, Tinubu submitted three other tax reform bills under the title, ‘Transmission of Fiscal Policy and Tax Reform Bills’ to the National Assembly.

The President also transmitted to the parliament the Joint Revenue Board Establishment Bill, which seeks to create a Tax Tribunal and a Tax Ombudsman.

He wrote, “The Nigeria Tax Bill: This bill seeks to provide a consolidated fiscal framework for taxation in the country.

“The Nigeria Tax Administration Bill: Aimed at offering a clear and concise legal framework, this bill will ensure the fair, consistent, and efficient administration of tax laws, facilitating ease of tax compliance, reducing disputes, and optimizing revenue collection.

“The Joint Revenue Board (Establishment) Bill: This proposal seeks to establish the Joint Revenue Board, the Tax Appeal Tribunal, and the Office of the Tax Ombudsman, which will work to harmonise, coordinate, and resolve disputes arising from revenue administration in Nigeria.”

Tinubu emphasised that the proposed tax bills would have far-reaching benefits for the country, promoting taxpayer compliance, strengthening fiscal institutions, and fostering a more effective and transparent fiscal regime.

“I am confident that the bills, when passed, will encourage investment, boost consumer spending, and stimulate Nigeria’s economic growth,” Tinubu stated.

On the floor of the House of Representatives, Speaker, Abbas, confirmed receipt of the bills, stressing that they were designed in line with the objectives of the present administration.

He noted that when passed into law, the bills would encourage the growth and sustainability of the economy.

The House also consolidated six bills seeking the repeal of the Fiscal Responsibility Act, 2007 to enact the Fiscal Responsibility Bill, 2024.

The bill aims at ensuring prudent management of the nation’s resources, ensuring long-term macro-economic stability of the national economy; and securing greater accountability and transparency in fiscal operations within the medium-term fiscal policy framework.

Abbas, who presided over plenary, urged the Committee on Rules and Business to fix a date for debate on the general principles of the newly consolidated bills.

It was recalls that the tax reforms are policy recommendations from Taiwo Oyedele’s Presidential Fiscal Policy and Tax Reforms Committee, which seeks to reduce taxes in the country from the current 62 to a maximum of nine.

It also aligns with the recommendations of the President Tinubu Policy Advisory Council, which proposed declaring a state of emergency on revenue generation in the country.

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