My Blog

Tag: Fiscal Policy

  • Altered After Parliament: Nigeria’s Tax Laws and the Crisis of Executive Power

    Altered After Parliament: Nigeria’s Tax Laws and the Crisis of Executive Power

    By

    Dahiru Ali

    Nigeria’s recent tax reform laws, widely seen as a landmark step toward modernizing the country’s revenue system, have become the focus of growing scrutiny following allegations that the laws were altered after parliamentary approval. The House of Representatives Minority caucus has accused relevant actors of introducing unauthorized changes, raising questions not only about procedural integrity but also about the broader balance of power between the executive and legislative branches in Nigeria.

    The controversy came into the public eye in mid-December 2025 when Abdussamad Dasuki, a member of the House, claimed that key provisions of the newly enacted tax laws had been altered in the versions gazetted for public release. The allegations immediately sparked public debate, with some Nigerians calling for a suspension of implementation pending clarification. The concern, critics argue, is that changes made outside the legislative process could have significant legal, economic, and political consequences.

    A day before Dasuki’s public allegations, the leadership of both chambers of the National Assembly had instructed Kamoru Ogunlana, clerk of the Assembly, to coordinate with executive agencies to re-gazette the laws. Some analysts interpreted this directive as a tacit acknowledgment that the original gazetted versions contained errors or deviations from the versions approved by lawmakers.

    The laws in question include the Nigeria Tax Act, 2025, the Nigeria Tax Administration Act, 2025, the Joint Revenue Board of Nigeria (Establishment) Act, 2025, and the Nigeria Revenue Service (Establishment) Act, 2025. Each of these laws represents a key component of the government’s broader fiscal reform agenda, aimed at streamlining tax administration, broadening the tax base, and improving revenue mobilization.

    Yet preliminary findings from a seven-member committee appointed by Minority Leader Kingsley Chinda suggest that substantive alterations may have been introduced in some of the laws after passage. The committee, chaired by Afam Ogene, includes representatives from all six geopolitical zones: Aliyu Garu (Bauchi), Stanley Adedeji (Oyo), Ibe Osonwa (Abia), Marie Ebikake (Bayelsa), Shehu Fagge (Kano), and Gaza Jonathan (Nasarawa). Their mandate is to investigate discrepancies between the National Assembly-certified copies of the laws and the gazetted versions.

    Key Alleged Discrepancies

    According to Ogene, the Nigeria Tax Administration Act, 2025, shows the greatest variation among the four laws. The committee identified multiple areas of concern:

    • Tax compliance thresholds: Section 29(1) of the House-certified version set the tax compliance reporting threshold at ₦50 million for individuals and ₦100 million for companies. In the gazetted version, the threshold for individuals was reportedly reduced to ₦25 million, with company thresholds altered as well. Critics argue that such a change could significantly expand the number of taxpayers subject to reporting requirements.
    • Appeal conditions: Sections 41(8) and 41(9) were allegedly added in the gazetted copy, requiring taxpayers to deposit 20 percent of disputed tax amounts before appealing to the High Court. These provisions were reportedly not part of the version passed by the National Assembly.
    • Expanded enforcement powers: The gazetted law allegedly empowers tax authorities to arrest suspected offenders and sell seized assets without a court order, a provision absent from the original legislative version.
    • Altered definition of federal taxes: Section 3(1)(b) of the House-certified version defined federal taxes to include income tax, petroleum income tax, stamp duties, and value-added tax (VAT). The gazetted copy reportedly removed petroleum income tax and VAT from federal administration, potentially impacting revenue streams and intergovernmental fiscal relations.
    • Dollar-denominated petroleum tax computation: Section 39(3) of the gazetted version mandates that petroleum tax calculations be conducted in US dollars rather than in the currency of the transaction, diverging from the version passed by parliament.
    • Oversight provisions weakened: The National Revenue Service (Establishment) Act, 2025, allegedly had clauses removed that allowed lawmakers to summon officials, demand reports, and ensure accountability. Sections 30(1)(d) and 30(3), which provided for quarterly and annual reports to parliament, were reportedly deleted, raising concerns about the weakening of legislative oversight.

    Implications for Governance and the Rule of Law

    Experts argue that if these discrepancies are confirmed, they could have far-reaching consequences for governance in Nigeria. “The National Assembly is constitutionally empowered to make laws, and any unilateral alterations outside the legislative process undermine both the rule of law and democratic accountability,” said a constitutional law scholar who spoke on condition of anonymity.

    The controversy highlights the perennial tension in Nigeria’s governance system between the executive and legislative branches. While the executive is charged with implementation, the legislature retains the mandate to make and oversee laws. Any interference with this process, intentional or accidental, threatens the checks and balances that underpin democratic governance.

    The controversy has also reignited debate over the role of the presidency in legislative affairs. Analysts suggest that any unilateral alterations to passed laws, whether directly authorized or passively tolerated, signal a worrying disregard for democratic norms and the checks and balances that are meant to safeguard the country’s governance. Such actions, critics argue, risk eroding public confidence not only in the presidency but in the broader institutional framework that underpins Nigeria’s democracy.

    The issue also underscores broader concerns about transparency and procedural rigor in the publication of laws. Legal experts note that discrepancies between parliamentary-certified copies and gazetted versions could lead to confusion among taxpayers, enforcement agencies, and courts, creating uncertainty that may hinder the effective application of the tax reforms.

    Historical Context

    Nigeria has experienced similar controversies in the past, where differences between legislative texts and official publications have sparked public debate and legal challenges. Historically, such incidents have often fueled debates about executive overreach, the reliability of government documentation, and the integrity of legislative processes. Observers note that while these controversies sometimes resolve through clarifications or re-gazetting, the reputational impact on institutions can be long-lasting.

    The current allegations gain additional weight in the context of Nigeria’s ambitious economic reform agenda. Tax reforms are central to the government’s strategy to reduce dependence on oil revenue, expand the tax base, and modernize public finance management. Any procedural irregularities in the laws themselves risk undermining public confidence and investor trust, which are essential for successful implementation.

    Next Steps

    The House Minority committee has requested an extension of time to complete its review. Ogene emphasized that the committee’s work is aimed at ensuring accountability and safeguarding the constitutional role of the legislature. “Given the anomalies, illegalities, and potential procedural lapses, a thorough examination is warranted before the laws are fully implemented,” he said.

    Meanwhile, lawmakers, taxpayers, and policy analysts are closely watching the situation. Questions remain about who authorized the alleged changes, how they were made, and whether corrective action—including possible re-gazetting—will be sufficient to restore confidence in the legislative process.

    The controversy also serves as a reminder of the importance of transparency, meticulous record-keeping, and public oversight in the lawmaking process. As Nigeria continues to pursue economic and fiscal reforms, the integrity of legislative procedures will remain a critical factor in ensuring that reforms are both effective and legitimate.

    Broader Lessons

    At its core, this issue is not just about tax thresholds or procedural discrepancies; it is a reflection of the broader governance challenges that Nigeria faces. The balance of power between the executive and legislature, the clarity of legal texts, and the robustness of oversight mechanisms are all tested when allegations of post-passage alterations emerge.

    As the investigation unfolds, it provides an opportunity for Nigerian institutions to reinforce accountability, clarify procedural standards, and ensure that reforms—especially those with wide-reaching economic and social impact—are implemented with both transparency and legitimacy. For citizens, policymakers, and investors, the outcome of this scrutiny will offer insights into the resilience of Nigeria’s democratic and institutional processes.

    For now, the country watches as the investigation continues, aware that the resolution of this controversy will have implications not only for the implementation of the tax reforms but also for the credibility of Nigeria’s legislative and governance institutions.

  • Hon. David Olofu: When Preparation Meets the Moment

    Hon. David Olofu: When Preparation Meets the Moment

    A technocrat shaped by fiscal discipline, community loyalty, and quiet conviction steps forward to test experience against the demands of electoral leadership in Benue South.

    Shortly after dawn in Abuja, as the city settles into its familiar rhythm of traffic, briefings, and guarded optimism, a quieter political moment begins to take shape. At an understated venue, Hon. David Olofu prepares to meet the media, not to stage a spectacle, but to explain a decision that has been forming over years of public service.

    Further to his declaration in October 2025 to contest the Benue South Senatorial seat in the 2027 General Election, Olofu’s interactive session with journalists this morning marks a defining point in his political journey. It is the moment where preparation meets public intent, where experience built largely away from cameras is brought deliberately into open conversation.

    For those who have followed his path, the step feels less like an announcement than a culmination.

    Olofu’s story begins far from Abuja, in Opaha, Edikwu Ward 2 of Apa Local Government Area, where community life leaves little room for abstraction. Growing up within the Idoma nation, he learned early that leadership is measured by proximity to people and responsiveness to shared challenges. Those formative experiences never loosened their hold on him, even as his career carried him into the inner workings of government.

    That grounding became especially evident in 2015, when he assumed office as Commissioner for Finance and Budget in Benue State. Over the next eight years, he worked in one of the most demanding corners of governance, steering fiscal planning through economic uncertainty and mounting public expectations. Colleagues recall a man methodical under pressure, convinced that budgets were not merely technical exercises but moral documents—expressions of government’s priorities and credibility.

    His steady stewardship soon drew national attention. Between 2019 and 2023, Olofu served as Chairman of the Forum of State Commissioners for Finance in Nigeria, coordinating fiscal conversations among the states and engaging federal institutions on sustainability and reform. His later appointment as Senior Technical Adviser to the Nigeria Governors’ Forum placed him within national policy spaces where decisions quietly shape the direction of states long after political cycles turn.

    Yet, national relevance only sharpened an enduring question: how could this experience be translated into direct representation for the people who shaped him?

    That question came into focus in June 2025, when Olofu resigned from the People’s Democratic Party (PDP) after years of membership. The move was neither abrupt nor confrontational. Instead, he described it as a recalibration, an effort to align platform with principle and representation with conviction. In Apa Local Government Area, the decision ignited renewed political conversations, positioning him as a rallying figure for those seeking leadership defined more by competence than allegiance. His eventual alignment with the African Democratic Congress (ADC) reflected this evolving political direction.

    By October 2025, months of consultations across Benue South matured into resolve. Olofu formally declared his intention to contest the senatorial seat, following engagements that included community meetings, stakeholder dialogues, and symbolic royal blessings in Ugbokpo, Otukpo, Obagaji, and Ohimini. Across these interactions, his message remained consistent: development anchored on infrastructure, improved security, economic inclusion, and deliberate youth empowerment—pursued through informed and effective legislative action.

    Running parallel to this political journey is a quieter, deeply personal commitment to service. Through the Apa Legacy and Sustainability Initiative, Olofu has invested in education, healthcare, and community empowerment. His ₦50 million Education Support Fund has enabled Idoma students to remain in tertiary institutions, while his ₦10 million contribution to maternal and infant healthcare at St. Helen’s Specialist Hospital, Otukpo, addressed urgent local needs. To those close to him, these efforts are not political gestures but reflections of a leadership philosophy that views service as continuous rather than episodic.

    Taken together, Olofu’s profile reveals a leadership style shaped by patience, preparation, and proximity to people. With a background in finance, a record of public accountability, and enduring grassroots ties, he represents a growing class of Nigerian leaders whose credibility is built quietly and sustained deliberately.

    As Benue South looks toward the 2027 elections, Olofu’s transition from state commissioner to national policy adviser and now senatorial aspirant reads less like a leap and more like a progression, anchored in experience, guided by conviction, and sustained by belonging. As he sits before the media in Abuja this morning, he does so not with urgency, but with intent, offering himself for a responsibility he believes he has long been preparing to carry.

    In a political season often defined by haste and high volume, David Olofu’s entrance is measured, an argument that leadership, like trust, is best built before it is demanded.

  • Forgeries, taxations and the reign of Rehoboam

    Forgeries, taxations and the reign of Rehoboam

    By UGO ONUOHA

    “A profligate regime should not expect Nigerians to willingly submit to a new tax regime that looks like an exercise in extortion. The administration gets its priorities wrong. At a time that virtually all federal highways have collapsed and become deathtraps, this government prioritises the construction of a N15 trillion coastal highway from Lagos to Calabar.”

    A little over three months into the presidency of Alhaji Bola Ahmed Tinubu, on September 5, 2023, I wrote an opinion piece titled “100 days of Rehoboam” in this space and elsewhere. Rehoboam was a king of the divided kingdom of ancient Israel. He was the son of King Solomon and the grandson of King David, both of whom were also past rulers of a united Israel. Rehoboam caused Israel to be divided through policies that inflicted pains on his people. He was reckless. He was proud. He was unfeeling. He took counsel from his scatter head fellow young men. He told the Israelites that the privations they suffered under his father should be regarded as a child’s play. And that while his predecessors chastised them with a whip, he would chastise them with a scorpion. And he verily proceeded to do so. Rehoboam and Tinubu share similarities and dissimilarities. Rehoboam was a monarch. Tinubu is not a king in spite of his pretending to be one. Rehoboam was born into royalty. Tinubu was not. Indeed Tinubu’s birth and early years are still subjects of conjectures and controversies. Rehoboam was a young man when he ascended the throne of his fathers, and so could be excused on account of youthful exuberance. Tinubu was an old man when he was installed as president of Nigeria though his true age is only known to himself and himself alone. There’s no verifiable evidence of when he was born and where. Unlike Rehoboam, Tinubu takes no counsel from anyone. He said this much himself when, without consultations and without a Cabinet, he unilaterally removed the so-called petrol subsidy.

    Tinubu at 100 days in office] has been like that proverbial bird that perched on a tree branch—the branch has remained unsettled and the bird can’t stop dancing to unheard sounds. Since his inauguration on May 29, 2023, exacerbated hopelessness has been the lot of Nigerians. Tinubu himself can only pretend to have peace of mind…”

    On September 5, 2023, I wrote this about Tinubu and Rehoboam. “[Tinubu at 100 days in office] has been like that proverbial bird that perched on a tree branch – the tree branch has remained unsettled and the bird can’t stop dancing to unheard sounds. Since his inauguration [as president] on May 29 [2023], exacerbated hopelessness has been the lot of Nigerians and Tinubu himself can only pretend to have had peace of mind. If he has had the presence and prescience of mind, he would not have been enmeshed in serial fumbling from one policy somersault to another from the removal of the so-called petrol subsidy, [devaluation of the Naira], student loan and [the] proposed payment of N8,000 per month for six months to a specified number of poor Nigerian families, and planning to lead the Economic Community of West African States [ECOWAS] to war on Niger Republic [when the military in that country seized political power]”… In Igbo Tinubu is a classical case of ‘akwu rere ere n’ikwo puru epu’ which transliteration in English language will roughly read: rotten palm fruits being pounded inside a decayed mortar. The finished product is better left to the imagination…”

    When Rehoboam became the king, the older advisers in the palace pleaded with him “to heed the cry of the people and lighten the heavy load of labour and taxes that Solomon had laid on them, but the younger elements who had grown up with the new king counselled otherwise. He took the counsel of his mates. The consequences of the actions of the new and rash King Rehoboam are well documented in the chronicles of the kings of Israel in the Holy Bible book of 1Kings. In Tinubu’s rash and irrational decisions [on] the first day and [subsequent] weeks of his reign, he appears to have borrowed a leaf from the wicked and unthinking  King Rehoboam”. One of the undoings of Rehoboam was that he insensitively raised taxes on his people and so lost more than half of his kingdom. The northern part of Israel split away, taking its own path separate from the southern kingdom of Judah. But Nigeria is not a monarchy and bears no resemblance to the old kingdom of Israel. Does that mean that Nigeria splitting is unthinkable?

    With the new tax laws set to come into effect in a matter of days, Tinubu who rules like a monarch may yet be treading the path of King Rehoboam. Rehoboam raised taxes on his people at a time they were already complaining of privations and pains, Tinubu is poised to also raise taxes on Nigerians at a time the people are groaning under the weight of a multiplicity of harsh economic policies of the regime. And he appears not to be bothered. He is irritated by wise counsel that he steps on the brakes and allows Nigerians to breathe. Instead, he empowers the relevant agency of government to execute a secret contract with a so-called tax consultant in France which may lead to handing over Nigeria’s tax data to a foreign company. Tax data is a national security issue that should not be traded as a favour to a friend. Tinubu and the president of France, Emmanuel Macron, are known to be buddies. The frequent ‘working visits’ of our president since he assumed office a little over two years ago had been to Paris, France, unlike his predecessor, Muhammadu Buhari, who made London his tourism and medical destination, and the former archbishop of Canterbury his bosom friend. And a go-to man.

    A profligate regime should not expect Nigerians to willingly submit to a new tax regime that looks like an exercise in extortion. The administration gets its priorities wrong. At a time that virtually all federal highways have collapsed and become deathtraps, this government prioritises the construction of a N15 trillion coastal highway from Lagos to Calabar. To add insult to injury, the contract for the road was not subjected to an open and transparent bidding, no public tendering, no definite and finite route, and no environmental impact assessment report. To cap it up, the highway contract was awarded to a known long time friend and business associate of Tinubu. The president’s son, Seyi, is alleged to be a significant shareholder in some of the companies in the Chargouri Group which owns Hitech construction company which was awarded the opaque Lagos – Calabar highway contract. This is a classic and glaring case of abuse of office. The argument by the regime that much of the money for the execution of the road contract would be borrowed does not make the smell of the contract less pungent and offensive. Even the money to be borrowed will still have to be paid by Nigerians. By you. Or by me. Or by our children and grandchildren.

    As the government preps to extract more taxes from us, it is telling us that we should be the people to fund their ostentatious, obscene and provocative lifestyles including, committing billions of Naira to build or to refurbish mansions for the president and vice president, buy hundreds of foreign manufactured sport utility vehicles [SUVs] for ministers, a coterie of advisers, lawmakers, local government chairmen, and even for the wife of the president whose well appointed office of the first lady is not known to any law in the land. Members of the boards of MDAs [ministries, departments, and agencies] are usually not left out of the largesse. Ours is probably the only country in the world where government computers, vehicles, websites, and the like, are replaced every year. The debauchery includes procuring a fleet of armour – plaited presidential limousines every four years with the advent of a new president and a presidential jet in tow. Of course, the issue of looting the public treasury has been normalised. It’s so brazen that public servants routinely send their children to schools abroad where the fees are charged in millions of the United States dollars. If you want to be reminded of how decadent the system is, do not look further than the annual budget provisions for the feeding of our president and his family. It runs into multiple billions of Naira. We give the president a rent-free accommodation, we afford him and his family pro bono top rate round-the-clock security, gift him a fleet of high-end luxury vehicles, fuelled and maintained at our expense, top it up with a presidential jet, and then turn around to pay him millions of Naira every month as salary. Not even the United States of America, the biggest economy in the world, does that.

    In spite of the foregoing proclivity of this regime to extort citizens, it still cannot be satisfied and appeased. It is a leopard that cannot change its spot. The information last week was that the administration had allegedly fiddled and rigged the tax reform laws passed by the national assembly [NASS]. Last week Rep. Abdulsamad Dasuki  [PDP, Sokoto] raised the alarm, alleging discrepancies between the tax laws passed by NASS and the versions subsequently gazetted and made available to the public. He said the rigging of the laws should be concerning because some provisions were deleted and strange and terrifying provisions illegally inserted. Hon. Dasuki had said during plenary on the floor of the House that his legislative privilege had been breached by the fact that the content of the tax laws as gazetted by the executive arm of government did not reflect what lawmakers debated, voted on, and passed on the floor of the House. “I was here, I gave my vote and it was counted, and I am seeing something completely different”. He said that he obtained copies of the gazetted laws from the ministry of information and found them to be inconsistent with what was approved by both the House and the Senate. Dasuki said that there had been ”a serious breach”, and warned that allowing laws different from those duly passed by the national assembly to be presented to Nigerians would undermine the integrity of the legislature and violate the Constitution.

    “Mr. Speaker, I will be pleading that all the documents should be brought before the Committee of the Whole [House]. Thank you. The whole members should see what is in the gazetted copy and see what they passed on the floor so that we can make the relevant amendment. Mr. Speaker, this is a breach of the Constitution”. Consequent upon the alarm, the House raised a committee of seven persons to probe the allegations. However, Nigerians are not fooled. The current administration across board, from the executive to the legislature and the Judiciary, is populated by people who are adept at rigging and forgery. The NASS and the executive, working separately or in collusion, routinely rigged our national budgets. The 2025 fiscal document is the latest of fiddling with budgets. It was reported and never denied that about 6,000 illegal projects were inserted into the budget with accompanying billions of Naira allocations. We complained and grumbled and then moved on as usual. In effect, the NASS is the least morally competent to cry foul on the issue of rigging and forgery of documents. The same can be said of the judiciary where court judgements, especially of political hues, are routinely awarded to the highest bidder or to the most powerful and connected. So our system thrives on rigging or “mago mago” or “wuru wuru” to use the local lingo.

    But whether rigged or not the implementation of the new tax laws should be suspended, if it cannot be scrapped. It’s inhuman and inhumane to tax poverty. The majority of Nigerians are dirt poor. The other day, a top federal government official said that about 80 million citizens do not know where their next meal would come from. And a little over two years ago, the national bureau of statistics [NBS] determined after its study that over 130 million Nigerians were dimensionally poor. Certainly, the figure should be higher today given what Nigerians have been subjected to since May 29, 2023. And by the way, there has been no concrete evidence that any country has engendered or engineered economic recovery by taxing the poor. Instead putting more money in the pockets of citizens could help to reflate the economy as long as it is done in a manner that will not trigger inflation.

    UGO ONUOHA, a Veteran Journalist, was the Managing Director/Editor-in-Chief, Champion Newspapers Limited

  • Retain SSB Tax In 2024 Fiscal Policy, CSOs Tell FG

    The national SSB Tax coalition, Gatefield Nigeria, National Action on Sugar Reduction, One Campaign amongst other Civil Society Organisations, have tasked the Federal Government to retain the SSB tax in the 2024 fiscal policy.

    According to the coalition, it will ensure the purpose of the policy is achieved as well as ensure that the government benefits from its implementation. 

    The CSOs, who made the call at a meeting which also had in attendance representatives from the Ministry of Finance, Budget, and National Planning, Ministry of Education, National Orientation Agency and others also called for the establishment of an inter-agency Adhoc committee on SSB Tax that would harmonise the views of all stakeholders.

    The recommendation was made in a communique at the just concluded National conference on Sugar Sweetened Beverages (SSB) Tax orgainsed by Corporate Accountability and Public Participation Africa (CAPPA) in collaboration with the Federal Ministry of Health and Social Welfare Wednesday in Abuja, further called on relevant stakeholders, including traditional and religious institutions, educational institutions, civil society organizations, the media, and healthcare professionals to actively engage in other to curb the SSB menace. 

    According to them, “the proceeds from the SSB tax should be earmarked to the health sector to support and strengthen public health systems in Nigeria. 

    “Stakeholders must commit to engaging central budget agencies to improve public healthcare and influence increased allocation to the healthcare sector. 

    “Need for the establishment of a monitoring, evaluation, and accountability framework to track the implementation and impact of the current SSB tax policy. This must be reviewed periodically. 

    “Need for complementary regulatory instruments like Front-of-Pack Labeling, restricting availability and marketing of SSBs in school environments among others to offer consumers more information about products. 

    “State authorities must strive to bring Nigerians into its social health insurance scheme to achieve universal healthcare coverage and the Federal Government and regulatory authorities must design and enforce penalties for companies that default on SSB tax obligations.”

  • Tinubu Orders Speedy Implementation Of Tax Reforms Report

    President Bola Tinubu has instructed his Special Adviser on Policy Coordination, Hadiza Usman, to work with the Office of the Secretary to the Government of the Federation to coordinate the recommendations of the Presidential Fiscal Policy and Tax Reforms Committee for swift implementation across all Ministries, Departments, and Agencies. 

    This directive was issued during a meeting with the Chairman of the reforms committee, Mr. Taiwo Oyedele, who presented a 30-day report on “quick wins” at the Aso Rock Villa in Abuja.

    Special Adviser to the President on Media and Publicity, Ajuri Ngelale, revealed that President Tinubu met with Mr. Zack Adedeji, the Acting Chairman of the Federal Inland Revenue Service, and Mr. Taiwo Oyedele, the Chairman of the tax policy review committee. 

    The President emphasized the need for effective synergy in implementing tax policy recommendations across government institutions.

    President Tinubu has also prioritized the recommendations of the tax policy review committee at the next Federal Executive Council meeting scheduled for Monday, October 30, 2023. The aim is to expand the tax net, reach the 18% tax-to-GDP threshold, and enhance public service provision without burdening vulnerable segments of the population.

    The Presidential Committee on Fiscal Policy and Tax Reforms, established on July 7, 2023, is responsible for tax law reform, fiscal policy coordination, harmonization of taxes, and revenue administration. Its mission is to improve tax morale, promote a healthy tax culture, and encourage voluntary compliance with tax regulations by utilizing tax and other revenues effectively.

  • We Won’t Increase Taxes, FIRS Assures Companies

    Acting chairman of the Federal Inland Revenue Service (FIRS), Zacch Adedeji, has allayed fears being expressed by corporate organisations that the resolve of FIRS to increase the country’s tax-to-GDP ratio to 18 per cent from 10.86 will lead to a hike in taxes.

    According to a statement by Special Adviser on Media and Communication to the Ag Executive Chairman, FIRS, Dare Adekanmbi, Adedeji said such resolve would not necessarily lead to increase in taxes or introduction of new taxes as the President Bola Tinubu-led administration is determined to create a wholesome environment for businesses to flourish.

    The FIRS chairman had said the agency under his leadership would in the next three years achieve an eight per cent raise in tax-to-GDP ratio to surpass Africa’s average of 16.5% without stifling investment or economic growth.

    The plan had triggered muffled apprehensions among entities corporate that the decision could cause an increase in tax rates or introduction of new ones.

    Addressing representatives of top large tax-paying companies during a get-together at Four Points by Sheraton in Lagos on Wednesday, Adedeji said, “Our belief, understanding and vision as a revenue-generating agency is not to introduce any new tax as we only want to use data to improve compliance.”

    A statement by his Special Adviser on Media and Communication, Dare Adekanmbi, quoted the FIRS chairman as saying that the invited companies and those willing to voluntarily carry out their tax obligations have nothing to be afraid of.

    “Our plan is simple. We want to grow tax revenue and we only want to tax prosperity and not poverty. Therefore, it is not in our interest to kill the trees that bear the fruits. My first ‘love letter’ to you is to appreciate what you have done. So, you don’t have anything to be afraid of.

    “We will not collect what is not due to us. But we don’t want anyone not to pay what is due to us. Fair engagement is our plan. Rest assured that the 18% tax-to-GDP target will not translate to increase in taxes.

    “If you have been listening to Mr Taiwo Oyedele who is the chairman of the Presidential Committee on Fiscal Policy and Tax Reforms, you will have known that part of the mandate of the committee is to reduce the number of taxes,” he said.

    According to him, the purpose of the engagement with the companies is to factor their inputs into the strategic action plan being mapped out in order to address challenges hampering tax revenue collection.

    He lauded the invited companies for their high sense of responsibility, urging them to continue to discharge their tax obligation diligently.  

    “I must also commend your commitment to upholding high tax compliance standards and responsible corporate citizenship, which sets you apart as the top taxpayers in Nigeria.

    “This aligns perfectly with our vision of making taxation the pivot of national development through voluntary compliance. Your respective industries play a pivotal role in generating substantial tax revenue for government and in shaping economic and fiscal stability of the nation.

    “We are not unmindful of the challenges facing businesses in Nigeria with the ongoing reforms to improve economic performance. These are painful but necessary choices we must make as a nation to attain our full potential,” he said.

    The chairman, while responding to some of the concerns raised by representatives of the companies such as multiplicity of taxes, duplication of tax oversight on corporate entities, promised to address the issues raised.

    Some of the companies at the event included Nestlé Nigeria Plc, ExxonMobil, Shell, Guinness, Nigerian Breweries Plc, Flour Mills, Dangote Group, MTN, British American Tobacco company, First Bank, Access Bank, Guaranty Trust Bank, Zenith Bank Plc, KC Gaming Limited (Bet9ja), Airtel, Seplat, BUA Cement, Nigeria Liquified Natural Gas, NNPC Limited and others.

  • FG Proposes N26.01trn For 2024 Fiscal Year

    FG Proposes N26.01trn For 2024 Fiscal Year

    The Federal Government has proposed the sum of N26.01 trillion for the 2024 appropriation based on oil price benchmark of $73.96 and 21 per cent interest rate.

    Minister of Budget and Economic Planning, Atiku Bagudu, disclosed this to State House Correspondents at the end of the Federal Executive Council (FEC) meeting on Monday in Abuja.

    He said that the budget would be presented to the National assembly before the end of the year since President Bola Tinubu was already engaging with the legislative arm towards getting their buy-in.

    He said that the budget was expected to consolidate on the various economic reforms initiated by the present administration aimed at improving the standard of living of Nigerians and attracting investors.

    Bagudu said that assumption of the budget was based on the various diplomatic engagements by the president and other government functionaries that were expected to improve inflow and boost exchange rate.

    Mr Dave Umahi, Minister of Works, also disclosed FEC approved the use of concrete for road projects across the country including those of new ones, depending on the level of completion.

    He said, ‘’FEC was also informed on the on-going projects and to mitigate so much inflation and variation of the projects, to have some of the projects that have attended completion to be redesigned on concrete and going forward for new projects to be done on concrete.

    ‘’FEC approved that concept that most of the on-going projects should be designed on concrete pavements depending on the level of completion and if you’re doing Asphalt there are also conditions for that.

    ‘’FEC also approved the coastal road running from Phase 1 which runs from Lagos to Port Harcourt to Calabar. Phase 2 runs from S4 tearing off from this stretch to Sokoto and to Ogoja.

    “It was approved to be done on Engineering, Procurement and Construction plus Financing.

    ‘’Eight roads that were started in the past administration for concessioning that have gone through all the processes were also approved and that the financial closure should be reached November.’’

    Umahi also said that a 24-hour approval would be given to any state interested in taking over road projects in their domain, while particular conditions must be met for the agreement to take effect.

    He said that the project by the states must conform to the standard of the Federal Ministry of Works as well as meet the tolling system through which they would recoup their investment.

    The minister also disclosed that FEC approved the NNPC and FIRS road projects, which they oversee and fund across the country.

  • IMF Advocates Fiscal Adjustments As Solution African Countries’ Debts 

    The International Monetary Fund (IMF) has urged African governments to re-anchor fiscal policy through a credible medium-term strategy to avoid a debt crisis.

    According to the Fund in its report ‘How to Avoid a Debt Crisis in Sub-Saharan Africa’, it stated that to avoid a debt crisis, African countries seek to achieve key debt targets.

    The Bretton Woods Institute said the average debt ratio in the region has almost doubled in 10 years adding that the average debt ratio to gross domestic product (GDP) has increased to 60 percent as of 2022, which is a 30 percent rise compared to the figures of 2013.

    According to the Fund, this is what makes debt repayment costlier.

    “In most sub-Saharan African countries, fiscal policy focuses excessively on short-term goals and is not guided by a clear medium-term strategy. This lack of anchoring has resulted in frequent breaches of fiscal rules and ever-increasing public debt levels.

    “A more strategic approach to fiscal policy would be preferable by setting explicit debt targets that integrate key policy trade-offs between debt sustainability and development objectives, rather than focusing narrowly on short-term fiscal deficits.

    “The paper suggests a novel approach to estimating country-specific medium-term debt anchors, which ensures that debt service costs remain manageable.

    “The region’s ratio of interest payments to revenue, a key metric to assess debt servicing capacity and predict the risk of a fiscal crisis, has more than doubled since the early 2010s and is now close to four times the ratio in advanced economies,” the IMF said.

    In the report, the IMF said more than half of the low-income countries on the continent are at high risk or already in debt distress as at the end of last year.

    The multilateral also said mobilising more domestic revenue through the elimination of tax exemptions or digitalising filing and payment systems is key to avoiding a debt crisis as well.

    “Sub-Saharan African countries tend to rely excessively on expenditure cuts to reduce their fiscal deficits.

    “Although this may be warranted in some circumstances, revenue measures, like eliminating tax exemptions or digitalizing filing and payment systems, should play a greater role.”

    The IMF noted that mobilising domestic revenue is less detrimental to growth in countries where initial tax levels are low, whereas the cost associated with reducing expenditures is particularly high given Africa’s large development needs.

  • Crude Export Earnings Hit N5.6trn In Q2 Amid Naira Float

    There was a major improvement in export earnings in the second quarter of 2023, as a result of the floating of the naira which ensured earnings from crude oil exports swells. Crude oil receipts rose 8.5 per cent to N5.6 trillion. This represents 79.6 per cent of total exports.

    “The improvement in export earnings was mainly spurred by crude oil receipts which rose 8.5 per cent quarter-on-quarter (q/q) to N5.6 trillion (about 79.6 per cent of total exports) though production level was unimpressive as per national Bureau for Statistics (NBS) data (down 19.2 per cent q/q to 1.22mbpd).

    “Noteworthy, we suspect that the improvement in oil receipt was also impacted by exchange rate revaluation gain given that the Central Bank of Nigeria (CBN) switched from a hard-pegged exchange rate regime to a managed float in June 2023, causing the official conversion rate of oil proceeds to rise from N461/$ to over N650/$. Hence, nullifying the effect of lower crude oil price in the second quarter ($78.13/bbl.) relative to the first quarter ($81.11/bbl.).”, said analysts at Afrinvest.

    Data from NBS showed that the value of Nigeria’s total trade (imports and exports combined) improved over the preceding quarter (up 5.8 per cent) but trailed the level attained in the corresponding period of 2022 by 7.6% to settle at N12.7 trillion.

    For the third consecutive quarter, Nigeria recorded a positive trade balance amounting to N1.3 trillion in the second quarter, aided by the faster growth in export earnings (up 8.1 per cent q/q to N7.0 trillion) as against import expenses (up 3.0 per cent q/q to N5.7 trillion).

    Similarly, non-crude oil and non-oil exports also grew 6.8 per cent and 5.6 per cent q/q to N1.4 trillion and N688.7 billion respectively.

    “We attribute these gains to the recovery in the broader economy from the negative knock-on effect of pre-election jitters and poor implementation of the naira redesign policy in the first quarter (GDP expanded 2.5 per cent vs. 2.3 per cent in the first quarter)”, said Afrinvest.

    It is important to highlight that Agricultural goods remain Nigeria’s largest source of non-oil export earnings (4.0 per cent of export share), while Manufacturing, Raw material goods, and Solid mineral goods trailed with 3.0 per cent, 2.1 per cent, and 0.5 per cent, respectively.

    Cashew nuts (shelled and unshelled), sesame seeds, and cocoa beans combined accounted for 65.7 per cent of the total N278.4 billion Agric exports in the period – an indication that cash crop exports could be a major source of non-oil foreign exchange (forex) earnings for Nigeria if adequate investment is made on procuring modern farming equipment and insecurity is wholistically checked.

    In terms of trade performance with other regions, the previous quarter’s trend was sustained as Nigeria booked a surplus with three of its five trading regions – America (N178.5 billion), Europe (N1.2 trillion), and Africa (N510.5 billion) – while a deficit was recorded in trade with Asia (N584.5 billion) and Oceania (N98 billion). In terms of destination, the Netherlands (11.2 per cent), the US (10.2 per cent), and Indonesia (7.8 per cent) were the top export hubs by share while China (22.2 per cent), the US (16.1 per cent) and Belgium (8.0 per cent) topped imports origin.

  • FCTA’s N34bn ground rent debtors will be penalised, says Wike

    The Minister of the Federal Capital Territory (FCT), Mr Nyesom Wike, says owners of landed properties owing the FCT Administration (FCTA) ground rents, amounting to N34 billion would be penalised.

    Wike stated this when members of the House of Representatives Adhoc Committee Investigating Failure of Mass Transportation in Nigeria, visited him in Abuja on Tuesday.

    He warned allottees owing the FCT Administration ground rents to either pay or have their property revoked and reallocated to those who could pay.

    “I have calculated the debt of nonpayment of ground rent, which is about N34 billion, and I am going to collect all of those back. I don’t care, all I want is for the rent to be paid,” he said.

    The minister said that the list of the people owing FCTA ground rent would be published on Thursday, adding that they would be given two weeks to pay.

    According to him, whoever does not pay, his land will be revoked and be given to whoever will pay so that the necessary services will be rendered.

    “People want to live in a beautiful city but don’t want to pay their dues which is impossible.”

    He said that the decision became necessary following a decision to tie projects to Internally Generated Revenue to enable contractors complete abandoned projects.

    Wike complained about the poor budgetary allocation to the FCT and appealed to the lawmakers to assist in improving its budgetary provisions.

    The minister also said that he would overhaul the Abuja Urban Mass Transport Company (AUMTCO), expressing displeasure that AUMTCO buses were loaned out without maintenance.

    Earlier, Chairman of the Ad-hoc Committee, Mr Afam Ogene said that his committee visited the minister to find solutions to epileptic mass transportation in the country and the FCT.

    Ogene described the development as “worrisome”, saying that over N16 billion had been invested in mass transportation during the Subsidy Reinvestment and Empowerment Programme (SUR-P) with little services being rendered.

    He expressed relief with the ongoing transformation of the Abuja Light Rail transport system, and traffic lights across the city.

    “We are here to encourage you to look into transportation and reorganize it. We will support you to do it and it will also solve problems of one chance in the city,” he pledged.