Why Tinubu introduced tax reform bills – Presidential aide Sunday Dare

According to Mr Dare, the goal is to refine the tax system and move the country from voluntary to corporate taxation.

The Special Adviser on Public Communication and Orientation to President Bola Tinubu, Sunday Dare, has said the tax reform bills were introduced to create an efficient tax system that will spur the country’s development.

He said this on Thursday while on a courtesy visit to PREMIUM TIMES office in Abuja.

He was received by the PREMIUM TIMES Managing Editor, Musikilu Mojeed, General Editor, Festus Owete, Assistant Managing Editor, Bisi Abidoye, Assistant Editor, Special Projects, Nosike Ogbuenyi, and Admin Manager, Willie Obaseota.

Mr Dare, who had served as Minister of Sport in the previous President Muhammadu Buhari administration, said more than 80 per cent of over 61 existing taxes are redundant.

He said the goal is to refine the tax system and move the country from voluntary to corporate taxation.

According to him, the freedom to generate revenue as a country is within the tax system.

Mr Dare pointed out that this model of the tax system, introduced in Lagos between 1999 and 2007, while Mr Tinubu was the governor, has turned out to be a significant success.

By reforming the tax system, he said, the president had raised the state’s internally generated revenue significantly from N600 million that it was in 1999.

“That template still exists in Lagos State. That’s why to get the state tax revenue, you will have to put together at least 15 states to get the revenue.

“What the president cares about is blocking the loopholes in the revenue and tax system and increasing the government revenue. We saw the success he brought to Lagos state,” he said.

Debates on the bills

Mr Dare also said part of the reasons the president insisted on leaving the bills with the parliament was to give room for deliberation.

Two months ago, when President Tinubu sent the bills to the National Assembly for approval, they faced stiff opposition even before the lawmakers started debating them.

The bills presented are the Joint Revenue Board of Nigeria (Establishment) Bill, 2024; The Nigeria Revenue Service (Establishment) Bill, 2024; The Nigeria Tax Administration Bill, 2024; and the Nigeria Tax Bill, 2024.

The Northern Governors Forum had expressed concerns that specific provisions of the proposed bills, particularly those related to Value Added Tax (VAT), were detrimental to the interests of the northern region and directed lawmakers from the area in the National Assembly to oppose the bills.

Similarly, the National Economic Council (NEC), which includes state governors and chaired by the vice president, advised President Tinubu to withdraw the bills for further consultation.

However, the president maintained that disagreements over the proposed legislation should be resolved within the parliamentary process.

Currently, the four tax reform bills have passed a second reading in the Senate.

Addressing this, Mr Dare said the president had carefully followed the debate and is being briefed daily about the arguments for and against the tax reform bills in the parliament.

“We have a president willing to listen to superior arguments,” Mr Dare told PREMIUM TIMES. “He has been following the conversation in the National Assembly. He has been briefed every day. We must also give our lawmakers the benefit of the doubt.”

‘Tax reform will not burden the poor’

Mr Dare also said that contrary to general belief, the bills do not seek to tax the poor or small business owners, as the reform aims to reduce the tax burden on the poorer population.

According to him, the new tax system will not include the Pay as you Earn (PAYE) tax, and persons who earn below N1 million will not be taxed, nor will businesses with profits below N50 million.

“The implementation of this tax reform will bring to life the true fiscal federalism that we have never had before,” he said.

“It also places some level of responsibility on the state government. They now have to bring investors, increase the VAT revenue from your state and use them. For NEC, the federal government has shed some weight. It now handles only 10 per cent, state 55 per cent, local government 35 per cent. This is true federalism.

“I am not saying it is a perfect document, but the very core of the tax reforms that we need is built into that document, which will foster development.

“The president has said the entire philosophy around this tax bill is that I do not want to tax the poor. He wants to tax prosperity. If there is no law, no one will pay,” he noted.

Meanwhile, PREMIUM TIMES Assistant Managing Editor, Mr Abidoye, pointed out the need for efficient communication of the president’s goal for public acceptance of the reform bills.

According to him, the public perception should always be prioritised and addressed through “proper messaging.”

“I think one critical aspect is messaging. How you framed the message matters. Messaging is important in a political process,” he said.