The tax reform bills that President Bola Ahmed Tinubu delivered to the National Assembly have significant revisions suggested by the House of Representatives Committee on Finance. that the committee changed several of the measures’ provisions, removed others, kept others, and added some new ones.CONTINUE FULL READING>>>>>
The tax reform bills that President Bola Ahmed Tinubu delivered to the National Assembly have significant revisions suggested by the House of Representatives Committee on Finance. According to Daily Trust, the committee changed several of the measures’ provisions, removed others, kept others, and added some new ones.
At yesterday’s resumption of plenary, Representative James Abiodun Faleke, the chairman of the House Committee on Finance, gave the House the reports on the unified tax reform legislation. In October 2024, President Bola Ahmed Tinubu forwarded the four tax reform legislation to the National Assembly for review and approval.
Following the conclusion of a three-day public hearing on the legislation, the reports were delivered. The committee then reviewed the memoranda that were provided to it and the comments that were made by different stakeholders throughout the hearing.
“Bill for an Act to Provide for the Assessment, Collection of, and Accounting for Revenue Accruing to the Federation, Federal, States, and Local Governments; Prescribe the Powers and Functions of Tax Authorities, and for Related Matters (HB.1756)” is one of the reports that were referred to the House on December 2, 2025.
Referred to on December 2, 2025, is “A Bill for an Act to Repeal the Federal Inland Revenue Service (Establishment) Act, No.13, 2007 and Enact the Nigeria Revenue Service (Establishment) Bill to Establish Nigeria Revenue Service, charged with Powers of Assessment, Collection of, and Accounting for Revenue Accruable to the Government of the Federation and for Related Matters (HB.1757)”
“Bill for an Act 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” (HB.1758) and “Bill for an Act to Establish Joint Revenue Board, the Tax Appeal Tribunal, and the Office of the Tax Ombud, for the Harmonization, Coordination and Settlement of Disputes arising from Revenue Administration in Nigeria and for Related Matters” (HB.1759).
The House of Representatives will start considering the measures clause by clause on Thursday, unless there are any last-minute changes. reduces the VAT increase and changes the inheritance tax The committee has, in the meantime, suggested several amendments to the measures that are being considered and passed by the House, clause by clause.
The laws were amended to remove some of the controversial provisions, including the VAT derivation and distribution formula, the rise in the VAT rate, the elimination of the TETFUND, NITDA, and NASENI, and the revision of the inheritance tax. The committee suggested keeping the present 7.5% VAT rate in place, even though section 146 suggested raising it to 10% by December 31, 2025; 12.5% from January 2026 to December 31, 2029; and 15% starting in January 2030.
The controversial inheritance tax provision was also changed by the committee. Although it was originally suggested that a deceased person’s inheritance would be taxed, it has since been changed to state that anyone who inherits the estate or a portion of it as an heir and uses it to fund profitable ventures will now be subject to taxes. NITDA, NASENI, and TETFUND will continue The committee changed Section 59 of the Nigerian Tax Bill, which called for the TETFUND, NITDA, and NASENI to cease funding by 2030. It suggested that the funding continue, but it also suggested that other agencies be allowed to use the 4% development levy budget.
The committee suggests the following distribution of the funds generated by the 4% development taxes placed on all enterprises’ assessable profits: The National Agency for Science and Engineering Infrastructure contributed 10%, the Nigerian Education Loan contributed 3%, the Tertiary Education Trust Fund contributed 50%, and the National Information Technology Development Fund contributed 5%.
The Nigeria Police Trust Fund is 5%, the National Sports Development Fund is 3%, the National Board for Technological Incubation is 3%, the Social Security Fund is 10%, the Defense Infrastructure Fund is 10%, and the National Cybersecurity Fund is 1%. The committee further suggested that all beneficiary agencies and funds listed in subsection (3) should prepare and submit their income and expenses to the National Assembly for appropriation in order to comply with this provision.
Although Section 22 of the bill suggested that “a taxable person shall, in respect of Value Added Tax (VAT), with or without a notice and whether or not an economic activity has taken place, submit a return to the Service in the prescribed form, by the date specified in subsection of this section or in a regulation issued by the Service for that purpose,” the committee suggested that a taxable person submit a return to the Service in the prescribed form by the 21st day of the subsequent month, regardless of whether or not an economic activity has occurred.
No matter the location, attribution The committee suggested that “for the purpose of attribution, any return under this section shall provide details of consumption of taxable supplies, irrespective of where the return is filed,” even though Section 22 (12) suggested that “for the purpose of attribution, any return under this section shall provide details of derivation of taxable supplies by location in a manner prescribed by the Service.”
“Where a relevant tax authority refuses to register or issue a Tax ID upon request under subsection (1) of this section, the relevant tax authority shall, within two working days of the decision, notify that person of the refusal,” according to Section 7(2) of the Nigerian Tax Administration Bill. Nonetheless, the committee suggested that “the relevant tax authority shall, within five working days of the decision, notify that person of the refusal with reasons whereby the relevant tax authority refuses to register or issue a Tax ID upon request under subsection (1) of this section.”
Regarding fiscalization The bill’s Section 23 suggested that anyone making a taxable supply must use the Electronic Fiscal System (EFS) to record and report all of their supplies when the Service implements one. Additionally, it suggested that technological requirements and security guidelines for using the EFS to record and report supply may be prescribed by the Service. Additionally, it stated that taxable individuals are in charge of keeping thorough records of every transaction that goes through the EFS.
“The Service shall specify the fiscalization system to be adopted and a transition arrangement for its implementation,” the committee suggested. Additionally, it suggested that (1) “Any person making a taxable supply shall use the Electronic Fiscal System (EFS) for recording and reporting where the Service deploys the EFS.” The committee further stated that “the Service shall specify the fiscalization system to be adopted and a transition arrangement for its implementation, and that Taxable persons shall be responsible for maintaining accurate records of all transactions passing through the EFS.”
“Everyone who has an obligation to deduct and remit tax under this Act or any other tax legislation shall render monthly returns as specified in the regulation issued for that purpose,” according to Section 27’s proposal. “Anyone who is required by this Act or any other tax law to withhold and remit taxes must submit monthly returns to the relevant tax authority, as detailed in the regulation issued for that purpose.”
Company tax rates Section 56 of the Nigerian Tax Bill proposed that “Companies shall be levied, for each year of assessment in respect of total profits of every company, in the case of— (a) a small company, at zero per cent; and (b) any other company, at the rate of– (i) 27.5% in 2025 year of assessment, and (ii) 25% from 2026 year of assessment.”
However, the committee suggested that tax be imposed at a rate of 30% on all companies, with the exception of those listed in subsection (2) of this section, and at zero percent on small businesses for each assessment year regarding their total profits. Additionally, it suggested that during the priority period, businesses operating in priority sectors listed in the Eleventh Schedule of this Act be subject to income tax at the rate of 25%.
90% of controversial topics resolved — Lawmaker Rep. Bappah Aliyu Misau (PDP, Bauchi) told our reporter yesterday that he had reviewed the controversial topics and found that more than 90% of the issues brought up had been resolved.
“I had the honor of attending the public hearing in order to gauge the sentiment of the country regarding the bills,” he stated. Therefore, the report’s difficult and disputed concerns were the first things I read when I viewed it. I started by doing that to see how the various viewpoints and recommendations made by Nigerians, both individually and in groups, had been taken into account. “The issue of VAT increase has been addressed; the issue of TETFUND, NITDA and NASENI scrapping has been removed. The proposed VAT increase from 7.5 per cent to 10 per cent and subsequently to a higher percentage has been removed.
The most important part of the tax reform bills that all Muslims must deal with is the inheritance tax. The matter has been dealt with directly. At first, it was suggested that a deceased person’s estate be subject to taxes. That component is no longer there. As per the current bill, if an heir inherits all or a portion of the inheritance and invests it in a business or property that generates returns for him, he will be subject to taxes.
“The additional concern we voiced regarding the Southern region receiving a larger portion of the VAT has also been resolved. Instead of sixty percent, we now have thirty percent derivation. Additionally, the derivation has changed; it will now be based on consumption rather than the location of a company’s or entity’s headquarters. Thus, the consumption rate is 30%. We reiterated that this 30% is due to fiscalization. The technology that can monitor consumption and supply the necessary data for calculations must be made available immediately.
The makeup of the proposed Joint Tax Board’s board is the other matter discussed. Following the chairman, it was decided in the bill that six executive directors, one from each of the political zones, would be nominated to the board, with representatives from all 36 states.
Thus, the heads of operations will be the executive directors. The previous rule called for only non-executive directors, who essentially had no authority but would follow the chairman’s instructions. According to the current bill, the president will pick the executive directors for a four-year term that can be renewed, and each zone will send one representative. Therefore, all of the ambiguities have been resolved.
With the proposed appointment of one member from each of the 36 states and the appointment of executive directors from the zones, the overbearing powers granted in the original draft have been curbed. He declared, “There is no longer any concern that the chairman will abuse his position of authority.” Fear in the North The bills had a lot of opposition, particularly from the North.
The region’s governors and National Assembly members expressed grave concerns about several aspects of the presidential measures. But following intense discussions and interventions, the governors and the tax reform team came to an agreement, which opened the door for public hearings in both houses of the national assembly.
Northern senators and members of the House of Representatives had hired some consultants to help them develop a convincing argument for why certain parts of the original proposals needed to be removed. According to one of the sources, “We were able to demonstrate our concerns, and happily, Rep. Faleke, the chairman of the finance committee, agreed.” However, another representative stated that they are currently considering some concerns.
Naturally, the Senate Committee on Finance, which is chaired by Senator Sani Musa of Niger State, has been informed of the majority of the problems we fixed in the House committee. We trust that the issues will be treated seriously as they are considered clause by clause. According to the insider, “we would like to think that some of our colleagues in the Senate and the House of Representatives would not be compromised.”
Warning signs According to our reporters, despite the recent public hearing on the Bills, there are still worries outside the National Assembly that a number of controversial and “potentially dangerous” aspects have not been addressed. These clauses were emphasized in a recent study by the Centre for Democratic Development Research and Training (CEDDERT), which claimed that important concerns that have a direct influence on citizens were overlooked. The article, written by Aliyu Rafindadi Sanusi and Abubakar Siddique Mohammed, was the second to be published by the group of intellectuals since the tax reform bills debate started.
The group had pointed out in the last report, which was published in December, how some rules would jeopardize Nigeria’s federal system. Additionally, CEDDERT emphasized “potentially dangerous” features that may be abused in the most recent draft, which was published in February. Because it has overlooked the numerous parts of these measures that are crucial for the welfare of the people, the consensus that emerged from the elites’ several political agreements over the bills “would have serious economic and social consequences,” the experts explained.
CEDDERT claims that President Bola Ahmed Tinubu used “all forms of subterranean means” to “snatch” some compromises from the governors. For example, the proposed Tax Administration Bill’s Section 75(1) gives the President unlimited power to exempt any business or group of businesses and any of their profits—regardless of where they come from—from income tax for any reason judged suitable. Additionally, it noted that the President has the authority “to amend, add, or repeal any tax exemption by issuing an executive order” under Section 75(2).
“There is no democratic country in the world where a president has such powers!” the group declared. Not in Russia, the US, or even the UK. This part of the law, which grants the President a lot of power, “will deepen centralization of authority, increase unproductive lobbies, reduce revenue, and increase corruption in ways similar to import duty waivers given in the past,” the researchers claim, if it is passed. Section 60 of the NTAB, which gives the authorities to seize assets of an individual whose assessment is final and conclusive, was also noted in the study.
In order to distrain any property, they do not require additional court consent (section 60(b)(3)). According to Section 61, they can break and enter the premises by using police with appropriate force. After 14 days, the authority may sell the seized property with the consent of the court (section 60(b)(4)). The research claims that due to abuse, this practice is either prohibited in many jurisdictions or limited to requiring court approval. Weak state institutions make this sector even more perilous. This clause allows for the targeting and financial crippling of citizens. In fact, it violates both the rule of natural justice and the constitution,” the experts said.
The group believes that all tax issues should be resolved in court in accordance with international best practices and the Joint Revenue Board’s regulation creating the Tax Appeal Tribunal. Additionally, it questioned the creation of special purpose tax officers, claiming that since they were granted police officer authority, they would merely serve to bolster the ranks of law enforcement personnel “who have continued to complicate law enforcement itself.”
Section 63, which gives the authorities to investigate or order an investigation to be launched on any individual, whether or not it is disclosed, based on suspicion stemming from lifestyle (Section 60(3)), was also considered in the publication. According to Section 63(2), the authorities may engage any law enforcement organization for this purpose. It believed that because of “the dictatorial tendency of our leaders,” this may be used to harass political rivals.
“Politicians themselves are in risk as well as the general public due to these intricate and overbearing powers. We are reminded of the attempt to utilize tax laws to keep Mallam Aminu Kano and Dr. Nnamdi Azikiwe from running for office by the danger of these provisions,” the statement continued.CONTINUE FULL READING>>>>>
