The remaining two bills are Nigerian Tax Bill 2024 and the establishment of the Joint Income Committee.
The Senate passed the remaining two of the four tax reform bills proposed by President Bora Tinubu on Thursday.
The two bills passed were the Nigerian Tax Bill 2024 and the establishment of the Joint Income Committee.
The bill was considered after the senators discussed them in the entire committee.
Senate Speaker Godswill Akpabio announced the passage of the bill after the majority of the senators supported it through audio voting.
The Premium Times reported on Wednesday that the Senate discussed and passed two tax bills. This is the Bill to establish a facility for Nigeria Revenue Agency and the Tax Management Bill.
With the passage of the remaining two bills, the Senate successfully passed four tax reform bills proposed by President Tinubu.
Recommendations and Adoption
Initially, Section 146 of the Nigerian Tax Bill proposed a gradual increase in value-added tax (VAT) from 12.5% to 12.5% to 12.5% to 12.5% by 2030, by 2026, 2027, 2028 and 2029.
However, stakeholders, including the Trade Union Congress (TUC), challenged the proposal during the hearing. The committee then reviewed the section and recommended that VAT be charged at a rate of 7.5%.
The bill also proposed gradual reductions in statutory funding for agencies such as the Higher Education Trust Fund (TetFund), the National Information Technology Development Agency (NITDA), and the National Agency for Science and Engineering Infrastructure (NASENI).
TetFund is funded primarily through a 2% education tax on the evaluable profits of registered companies in Nigeria. The funding will support the development of higher education by providing financial support to institutions for infrastructure, research and faculty training.
Meanwhile, Naseni plays an important role in driving scientific research, technological advancements and sector-wide innovation.
Similarly, NITDA is at the heart of Nigeria’s digital transformation, supporting ICT growth, capacity building and technology infrastructure development.
Due to its importance, unions like the University’s Academic Staff Union (ASUU) opposed cutting funds during the hearings.
The committee considered proposals for the bill and recommended that stakeholders retain legal funds from government agencies. The committee also recommended that statutory funds should be available to agencies such as national cybersecurity and defense security.
Now all institutions share 2% profits for the companies that were for TetFund. The committee recommended 50% of TetFund’s statutory funding, 15% of Nelfund’s, 10% of Nitda’s, 10% of Niseni, 5% of cybersecurity and 10% of defense security.
The Committee also amended clause 25 of the Bill of Establishing the Joint Income Committee to address the financing mechanisms for Nigeria’s tax surveillance and regulatory bodies.
Specifically, the amendment indicates that the Tax Appeal Court and the Tax Ombudsman office will be funded from the Integrated Income Fund, which is subject to the Parliamentary Expenditures budget.
Approval
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After deliberating on the clause-by-clause bill, Akpabio put its passage on the ballot, and the majority of the senators supported it through audio voting.
Akpabio then approved the committee’s recommendations on the bill, and a third reading of the bill was passed.
He then formed a 15-member committee, harmonizing the Senate’s decision on the bill with the version passed in the House. In harmony, a unified bill will be sent to President Tinubu for consent.
The committee members are minority leaders Avalomoro, Abdulazizyari (Zamfara), Eninaya Abaribe (Abia), Yahaya Abdullahi (Kebubi), Sanimusa (Niger), Antetokuboabi (Lagos), Joeltu Mos Onowakpo (Delta), Ashkoimaze Phovenie Kivenie Kuta (Taraba), Gbenga Daniel (Ogun), Osita Izunaso (IMO), Solomon Adeola (Ogun), Adams Oshiomhole (EDO), Hussaini Babangida (Jigawa), and Tahir Monguno (Borno).
