ABUJA, Nigeria — The Nigerian Senate on Thursday, November 28, 2024, approved the second reading of four contentious tax reform bills, following a dramatic debate marked by division and dissent among lawmakers.
The bills, transmitted by President Bola Tinubu to the National Assembly on October 3, aim to overhaul the country’s tax system and address pressing revenue challenges.
Senate Majority Leader Opeyemi Bamidele led the debate on the reforms, which passed via voice votes.
However, the session underscored the deepening controversy surrounding the proposed legislation, particularly among Northern governors and other stakeholders who oppose key aspects of the reforms.
Calls for Broader Consultation and Amendments
During Wednesday’s plenary, the tax bills sparked outrage when they were introduced for debate without being listed on the Order Paper, the official agenda.
Senator Ali Ndume voiced strong concerns about the timing and provisions of the bills, suggesting that amendments and broader consultations with governors, traditional rulers, and the National Economic Council (NEC) were necessary before proceeding.
“Reforms are necessary; I am not against any reforms. My problem is the timing, as it is today in Nigeria,” Ndume said.
He also raised concerns about the impact of tax burden shifts, stating, “If you move a tax burden to the manufacturer, he will transfer it to the consumer.”
Ndume proposed withdrawing the bills, amending them, and resubmitting them for expedited passage within 24 hours.
Despite these objections, the Chief Whip and other proponents of the reform stressed the importance of advancing the bills to the public hearing stage.
“The bill should scale second reading and undergo thorough examination during the public hearing.
Afterward, it can be subjected to clause-by-clause consideration,” the Chief Whip argued, urging lawmakers to prioritise legislative scrutiny over immediate withdrawal.
Tinubu Defends Reforms Amid Regional Resistance
President Tinubu has maintained that the tax reforms are crucial for national development and not targeted at any particular region.
However, resistance from Northern governors and stakeholders has highlighted regional tensions over the bills’ potential implications.
The proposed reforms include changes to Value Added Tax (VAT) and other key provisions aimed at reducing tax burdens on citizens while generating revenue.
Critics, however, have questioned the lack of transparency and limited public engagement in drafting the legislation.
Looking Ahead
The Senate’s decision to progress the bills represents a significant milestone in President Tinubu’s tax reform agenda.
The next phase will involve public hearings, where stakeholders are expected to present their concerns and recommendations.
As the bills advance, analysts say they will test the government’s ability to balance fiscal reform with the economic realities facing Nigerians, as well as the need for inclusive governance in addressing regional disparities.
