Northern Senators in Nigeria convened a closed-door meeting following the passage of the Tax Reform Bills for a second reading in the upper chamber.
This significant legislative development was announced during a plenary session and took place in room 301, lasting approximately two hours.
However, the specifics of the discussions remain undisclosed as Senator Abdulaziz Yar’Adua, Chairman of the Northern Senators Forum, refrained from commenting post-session.
Earlier that day, the Senate tasked its Finance Committee with inviting governors, the Governors Forum, traditional rulers, and other stakeholders to a public hearing on the bills.
This move followed the controversial bills' progression after a debate, which led to their referral to the Finance Committee with a directive to report back within six weeks.
The Tax Reform Bills, introduced by President Bola Tinubu in October, include the Joint Revenue Board of Nigeria (Establishment) Bill, 2024; Nigeria Revenue Service (Establishment) Bill, 2024; and Nigeria Tax Bill, 2024.
Initially, these bills faced rejection from northern governors who labeled them anti-democratic.
Consequently, the National Economic Council, chaired by Vice President Kashim Shettima, recommended withdrawing the bills for broader consultations to build consensus across the country.
During the debate, Senate Leader Opeyemi Bamidele highlighted the bills' objectives, which aim to simplify the tax landscape, reduce burdens on small businesses, and streamline tax collection processes.
Key proposals include increasing the Value Added Tax (VAT) share for sub-national governments to 55% while reducing the Federal Government's share to 10%, exempting essential consumptions from VAT, and offering VAT credits on business assets and services.
Additionally, the bills propose exempting individuals earning minimum wage or less from Pay As You Earn deductions and small businesses with an annual turnover of N50 million or less from taxes.
A notable reduction in company income tax from 30% to 25% for at least two years is also proposed, alongside harmonizing multiple taxes into a single development levy to fund a new student loan scheme by 2030.
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