Home Finance New tax reforms will Not increase tax burden, says Onanuga

New tax reforms will Not increase tax burden, says Onanuga

Nigerian tax reforms will not raise taxes
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Onanuga assures that new Nigerian tax laws aim for equitable tax distribution without increasing rates, addressing Northern Governors’ concerns.

 

 

Bayo Onanuga, the special adviser to President Bola Tinubu on information and strategy, has assured Northern governors that recently proposed tax reforms will not increase the number or rate of taxes.

This assurance comes after the Northern States Governors Forum (NSGF) voiced concerns that the new laws might impact the region unfairly.

 

Also read: FG to collect 7.5% tax on cryptocurrency transactions

 

Onanuga addressed these concerns on Thursday, responding to the NSGF’s collective call for the national assembly to reject any legislation potentially harmful to the Northern region.

The governors, after a joint meeting with the Northern Traditional Rulers Council at Kaduna Government House, stated that they seek fair and equitable implementation of any national tax policy.

In his statement, Onanuga clarified that the proposed laws—submitted by President Tinubu on 3 October—are designed to enhance the efficiency and equity of Nigeria’s tax system without increasing the existing tax burden.

“The tax rates or percentages will remain the same under these reforms,” he stated, emphasising that the proposals focus on fairer tax obligations, not additional costs.

The proposed laws include the Nigeria Tax Bill, the Tax Administration Bill, and the Joint Revenue Board Establishment Bill.

Onanuga explained that these laws aim to coordinate revenue collection across federal, state, and local levels to reduce inefficiencies and overlapping responsibilities currently plaguing Nigeria’s tax administration.

Onanuga highlighted that the reforms are not intended to harm any region, noting that they are structured to stimulate job creation through a robust, growth-oriented economy.

“These reforms will not lead to job losses. Rather, they are intended to open new avenues for employment,” he said, assuring stakeholders that no existing agency or ministry’s duties would be absorbed or eliminated.

Instead, the reforms will streamline revenue administration, integrating key taxes like Company Income Tax (CIT), Personal Income Tax (PIT), Capital Gains Tax (CGT), and Value-Added Tax (VAT) into a unified structure.

Addressing the NSGF’s concern regarding the VAT derivation model, Onanuga explained that the reforms propose a fairer VAT distribution model, focusing on where goods and services are supplied or consumed, rather than where the tax is remitted.

This model, he noted, is designed to ensure that states producing essential goods—many of which are based in the North—are not disadvantaged, even if their goods are consumed or exempt from VAT in other regions.

Taiwo Oyedele, chairman of the presidential committee on fiscal policy and tax reforms, also recently commented on the amendment, stressing that a consumption-based VAT system would create a fair distribution of revenue nationwide.

Onanuga concluded by encouraging urgency in passing these reforms, which, he said, could provide much-needed revenue to support national development efforts.

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