Tax Reform Bills: ACF submits recommendations to NASS, raises serious concern
…Recommends retaining current 7.5% VAT rate
By Austine Agbo Emmanuel, Kaduna
Arewa Consultative Forum (ACF) has submitted a comprehensive report to the National Assembly detailing its concerns and recommendations on the proposed Executive Tax Reform Bills.
In a statement issued to newsmen in Kaduna on Monday by the National Publicity Secretary of ACF, Prof. T.A Muhammad-Baba, the Forum said that the submission followed a detailed review by a special committee of experts set up by its Board of Trustees to analyze the bills.
Copies of the report have also been distributed to the Forum of Northern State Governors, traditional rulers, interest groups, government agencies, and other stakeholders, with e-copies made available to the public and the media.
The Forum argued that increasing the Value Added Tax (VAT) at this time would worsen the economic hardship faced by businesses and citizens. Instead, it advocates for improved efficiency in tax collection, the integration of informal sectors into the tax system, and leveraging digital technology to expand the tax base. It recommends retaining the current 7.5% VAT rate.
To support food production and enhance national food security, the ACF proposes removing VAT charges on agricultural equipment.
Also, it called for the revision of VAT-related sections in the Tax Administration Bill by replacing “supply and supplies” with “consumption or consumptions.”
The Forum stressed the need for a clear and unambiguous definition of “derivation” to prevent future disputes. It suggests that distribution should be determined through consultation with states, local governments, and the Revenue Mobilisation and Fiscal Commission (RMFC).
The report recommended a nationwide effort to name all streets and number houses in both small towns and major cities, making taxpayers more easily traceable for efficient tax administration.
To prevent revenue leakages, the ACF suggests setting annual upper limits on tax waivers and exemptions granted by the government.
The Forum warned against the concentration of excessive power in the Chief Executive Officer and Chairman of the Joint Revenue Board. It proposes that six Executive Directors, appointed by the President and confirmed by the Senate, replace the proposed eight Coordinating Directors.
The ACF advocated for restructuring Section 69 of the Nigeria Tax Bill to rename the tax as a Development Levy to be allocated to TETFUND, NITDA, NASENI, and the Education Loan Fund.
The Forum called for replacing the term “ecclesiastical” with “religious” throughout the Bills and urges the expungement of Section 4(3), which it argues should be left to Sharia and customary laws.
The Forum insisted that businesses should be allowed to maintain records and file tax returns in indigenous languages to ensure inclusivity.
The ACF urged all stakeholders, including business leaders, civil society groups, and state governments to actively participate in the upcoming public hearings of the National Assembly.
