Taiwo Oyedele, chairman, Presidential Fiscal Policy and Tax Reforms Committee, on Friday, engaged the Organised Private Sector of Nigeria (OPSN) on the urgency and benefits of the four proposed Nigeria tax reform bills.

The four bills are Nigeria Tax Bill, Nigeria Tax Administration Bill, Nigeria Revenue Service (Establishment) Bill and Joint Revenue Board (Establishment) Bill.

Mr Oyedele, at an interactive session with the OPSN in Lagos, said that it was time for the country’s tax reforms to happen.

This, he said, was important as the country faced major economic challenges such as high inflation, unemployment, rising poverty, low revenue, high public debt, declining investments and emigration.

According to Mr Oyedele, Nigeria needs bold fiscal ambitions and can no longer continue to celebrate incremental progress; hence, the public consultations and stakeholder engagement.

“Nigeria tax bill seeks to repeal certain acts on taxation and consolidate the legal frameworks relating to taxation and enact the Nigeria Tax Act to provide for taxation of income, transactions and instruments, and for related matters.

“2024 withholding tax regulations proposed changes seek to exempt small businesses from withholding tax obligations and lower rates for businesses with low margins.

“It also exempts manufacturers and producers such as farmers, and moves to curb tax evasion and avoidance,” he said.

The tax expert stated that key factors in the design of proposed Value Added Tax (VAT) reform was to moderate inflation and protect the poor and vulnerable.

He said that the progressive VAT reforms would reduce and not increase inflation, protect poor and Small and Medium Enterprises (SMEs) and facilitate business growth.

“The Consumer Purchasing Index (CPI) basket is made up of 12 classifications of individual consumptions.

“The low-income households spend nearly 100 per cent of their income on these basic consumptions.

“These include cereal and bread, tubers, meat and fish, rent, road transportation, pharmaceutical items and medical services, books and stationery,” he said.

Mr Oyedele listed the benefits of the tax reform bills on households and individuals to include complete exemption of low-income earners up to one million Naira per annum.

He said the benefits for SMEs included increase in tax exemption threshold for small businesses from annual turnover of N25 million to N50 million and exemption from company income tax for small businesses.

The chairman, OPSN, Francis Meshioye, said the four bills before the National Assembly were needed for a more conducive business environment for the private sector and businesses in general.

Mr Meshioye, also, president of Manufacturers Association of Nigeria (MAN), said it was necessary for all stakeholders to be fully involved in the new order.

“The private sector is a catalyst for sustainable economic growth, and as critical players, it is expedient we come to full understanding by maximising the benefits of this high level interactive session,” he said.

Segun Ajayi-Kadir, director-general of MAN, said that the bills had generated understandable interest across various sections of the Nigerian public.

He said the OPSN, as a business membership group, was necessarily concerned about the possible impact of the bills on investments and sustainability of businesses.

Mr Ajayi-Kadir noted that the challenge of multiple taxation featured as the topmost concern for manufacturers in the association’s Manufacturers CEO Confidence Index (MCCI).

He said while the association had engaged all the tiers of government to overcome the challenge, it had persisted.

“Unorthodox and demeaning methods of collecting legal and illegal taxes, by state and non state actors, have remained a permanent feature of our business life across the country.

“These, and many more, are the reasons this reform is of significant importance to our profitability and competitiveness.

“It is evident that the outcome of this reform initiative of President Bola Tinubu in general and the fate of the tax reform bills will redefine the business landscape in an unprecedented fashion,” he said.

The MAN director-general called for a fair and just tax system driven by humane tax administration that would promote voluntary compliance and ease of payment.

He pledged manufacturers’ commitment to be responsible corporate citizens, paying their taxes under a just tax regime.

(NAN)