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EXPLAINER: PROPOSED TAX REFORM BILLS NOT AGAINST THE NORTH; THEY WILL BENEFIT ALL STATES

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STATE HOUSE PRESS STATEMENT

EXPLAINER: PROPOSED TAX REFORM BILLS NOT AGAINST THE NORTH; THEY WILL BENEFIT ALL STATES

Governors of 19 Northern States of Nigeria, under the platform of the Northern Governors’ Forum, at their meeting on Monday, October 28, 2024, expressed their opposition to the new derivation-based model for Value-Added Tax (VAT) distribution in the new tax reform bills before the National Assembly.

Chairman of the forum, Governor Muhammed Inuwa Yahaya of Gombe State, read the communiqué.

The Northern Governors’ Forum meeting also had traditional rulers from the region, led by the Sultan of Sokoto, His Eminence Muhammadu Sa’ad Abubakar III, in attendance.

While we commend the Governors and traditional rulers for supporting President Bola Tinubu over the success recorded in addressing the country’s security challenges, we consider it necessary to address the misunderstandings and misgivings around the tax reform already embarked upon by the administration.

President Tinubu and the Federal Executive Council recently endorsed new policy initiatives aimed at streamlining Nigeria’s tax administration processes, enhancing efficiency and eliminating redundancies across the nation’s tax operations.

These reforms emerged after an extensive review of existing tax laws. The National Assembly is considering four executive bills designed to transform and modernise Nigeria’s tax landscape.

First is the Nigeria Tax Bill, which aims to eliminate unintended multiple taxation and make Nigeria’s economy more competitive by simplifying tax obligations for businesses and individuals nationwide.

Second, the Nigeria Tax Administration Bill (NTAB) proposes new rules governing the administration of all taxes in the country. Its objective is to harmonise tax administrative processes across federal, state and local jurisdictions for ease of compliance for taxpayers in all parts of the country.

Third, the Nigeria Revenue Service (Establishment) Bill seeks to rename the Federal Inland Revenue Service (FIRS) as the Nigeria Revenue Service (NRS) to better reflect the mandate of the Service as the revenue agency for the entire federation, not just the Federal Government.

Fourth, the Joint Revenue Board Establishment Bill proposes the creation of a Joint Revenue Board to replace the Joint Tax Board, covering federal and all states’ tax authorities.

The fourth bill also suggests establishing the Office of Tax Ombudsman under the Joint Revenue Board, which would serve as a complaint resolution body for taxpayers.

It is instructive to note that these proposed laws will not increase the number of taxes currently in operation. Instead, they are designed to optimise and simplify existing tax frameworks.

The tax rates or percentages will remain the same under these reforms, as they focus on ensuring a more equitable distribution of tax obligations without adding to the burden on Nigerians.

The reforms will not lead to job losses. On the contrary, they are structured to stimulate new avenues for job creation by supporting a dynamic, growth-oriented economy.

Importantly, these laws will not absorb or eliminate the duties of any existing department, agency, or ministry. Instead, they aim to harmonise revenue collection and administration across the federation to ensure efficiency and cooperation.

At the moment, tax administration lacks coordination among federal, state, and local tax authorities, often resulting in overlapping responsibilities, confusion, and inefficiency. Without reform, this inefficiency will persist.

The proposed laws aim to coordinate efforts between different tiers of government, resulting in better tax resource management and greater clarity for taxpayers.

Under existing laws, taxes like Company Income Tax (CIT), Personal Income Tax (PIT), Capital Gains Tax (CGT), Petroleum Profits Tax (PPT), Tertiary Education Tax (TET), Value-Added Tax (VAT), and other taxing provisions in numerous laws are administered separately, with individual legislative frameworks.

The proposed reforms seek to consolidate these multiple taxes, integrating CIT, PIT, CGT, VAT, PPT, and excise duties into a unified structure to reduce administrative fragmentation.

On the proposed derivation-based VAT distribution model, which the Northern Governors oppose, it must be stressed that the new proposal, as enunciated in the Bill, is designed to create a fairer system.

The current model for distributing VAT is based on where the tax is remitted rather than where goods and services are supplied or consumed. The ongoing tax reform seeks to correct the inherent inequity in the current derivation model as a basis for distributing VAT revenue.

The new proposal before the National Assembly outlines a different form of derivation which considers the place of supply or consumption for relevant goods and services. This means that states in the Northern region that produce the food we eat should not lose out just because their products are VAT-exempt or consumed in other states.

These reforms are critical to improving the lives of Nigerians and were not put forward by President Tinubu to undermine any part of the country. There is no better time than now for the National Assembly to give due consideration to these bills that will overhaul our tax systems and create the revenue all the tiers of government require to fund the development our country and people urgently need.

 

Bayo Onanuga

Special Adviser to the President

(Information & Strategy)

October 31, 2024

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US says it will not limit arms transfers to Israel after some aid improvements to Gaza

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Palestinians gather at the site of an Israeli strike in the courtyard of the Al-Aqsa Hospital where displaced people live in tents, in Deir al-Balah, Gaza Strip, Nov. 9, 2024 © Abdel Kareem Hana/Copyright 2024 The AP. All rights reserved.
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The Biden administration said on Tuesday that Israel made good but limited progress in increasing the flow of humanitarian aid to Gaza, and that it therefore would not limit arms transfers to Israel as it threatened to do a month ago.

However, relief groups say conditions are worse than at any point in the 13-month-old war.

State Department spokesman Vedant Patel said on Tuesday the progress to date must be supplemented and sustained but that “we at this time have not made an assessment that the Israelis are in violation of US law.”

This law requires recipients of military assistance to adhere to international humanitarian law and not impede the provision of such aid.

“We are not giving Israel a pass,” Patel said, adding that “we want to see the totality of the humanitarian situation improve, and we think some of these steps will allow the conditions for that to continue progress.”

The decision from the U.S. — Israel’s key ally and largest provider of arms and other military aid — comes despite international aid organizations declaring that Israel has failed to meet U.S. demands to allow greater humanitarian access to the Gaza Strip. Hunger experts have warned that the north may already be experiencing famine.

The Biden administration last month set a deadline expiring Tuesday for Israel to “surge” more food and other emergency aid into the Palestinian territory or risk the possibility of scaled-back military support as Israel wages offensives against Hamas in Gaza and Hezbollah in Lebanon.

 The obstacles facing aid distribution were on this display this week. Even after the Israeli military gave permission for a delivery to the northernmost part of Gaza — virtually cut off from food for more than a month by an Israeli siege — the United Nations said it couldn’t deliver most of it because of turmoil and restrictions from Israeli troops on the ground.

In the south, hundreds of truckloads of aid are sitting on the Gaza side of the border because the U.N. says it cannot reach them to distribute the aid — again because of the threat of lawlessness, theft and Israeli military restrictions.

Israel has announced a series of steps — though their effect was unclear. On Tuesday, it opened a new crossing in central Gaza, outside the city of Deir al-Balah, for aid to enter.

It also announced a small expansion of its coastal “humanitarian zone,” where hundreds of thousands of Palestinians are sheltering in tent camps. It connected electricity for a desalination plant in Deir al-Balah.

Eight international aid organizations, meanwhile, said in a report Tuesday that “Israel not only failed to meet the U.S. criteria” but also took actions “that dramatically worsened the situation on the ground, particularly in Northern Gaza. … That situation is in an even more dire state today than a month ago.”

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Constituents push for Senator’s recall over alleged involvement in banditry

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Senator Shehu Umar Buba represents Bauchi South Senatorial District under the All Progressives Congress (APC). [Facebook] ©(c) provided by Pulse Nigeria © Pulse Nigeria
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The Senator’s recent appointment as Chairman of the Senate Committee on National Security and Intelligence has attracted fierce criticism.

Senator Shehu Buba, representing Bauchi State’s South Senatorial District, is facing intense scrutiny and backlash following allegations linking him to terror suspects in Northern Nigeria.

The Department of State Services (DSS) is investigating his potential involvement with wanted terrorists, while his constituents are mobilising for a historic recall.

Buba, once a respected figure in Bauchi politics, is under fire after being connected to Abubakar Idris, a known terrorist arrested in August 2024.

Idris’s arrest reportedly implicated Buba, sparking outrage among his constituents, who are demanding accountability and the senator’s removal.

READ ALSO: US told to issue visa ban to Nigerian Senator linked to terror suspect

A formal recall process has been initiated, with registered voters in his district pushing for a referendum to remove him from office.

“This is a matter of national security. We cannot have someone with such affiliations in office,” one constituent declared, according to reports.

The recall movement is gaining momentum as more people sign a petition to trigger the process. If successful, the Independent National Electoral Commission (INEC) will be required to conduct a referendum, potentially marking the first time a sitting senator is removed by his constituents.

Buba’s woes deepened with revelations about his origins. Despite claiming to represent Bauchi, investigations show he hails from Plateau State, raising questions about his legitimacy.

An anonymous community leader expressed frustration, stating, “We thought he was one of us, but he’s not even a Bauchi indigene.”

READ ALSO: Senator Buba fires back at Bauchi Gov over banditry allegation

Buba’s political rise has been controversial. After moving to Bauchi in 2001, he built connections through family ties and political maneuvering, eventually securing a position as the Caretaker Chairman of Toro Local Government.

His success in politics, including his controversial senatorial nomination in 2022, has raised doubts about his integrity. Critics argue that his rise was influenced by powerful figures, including former Vice President Atiku Abubakar and former Bauchi Governor Isa Yuguda.

Buba’s recent appointment as Chairman of the Senate Committee on National Security and Intelligence has attracted fierce criticism. Political analysts argue that it is dangerous to have someone with such alleged links to terrorism overseeing national security matters.

“This is a grave error,” one analyst stated. “It’s a dangerous gamble to have him in charge of national security.”

With growing discontent, Buba has been noticeably absent from public events, fueling speculation that he is avoiding the backlash from his constituents. His dwindling visibility only adds to the tension, as many believe he is distancing himself from the growing outrage.

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Europe wants to strike Russia

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Europe wants to strike Russia © Pixabay
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The European Union should directly use $300 billion of frozen Russian assets to finance the recovery of war-torn Ukraine, according to Kaja Kallas, the candidate for the EU’s top foreign policy post.

Ms. Kallas, the former Estonian prime minister nominated for the post of EU high representative, said member states should abandon any doubts about the direct use of these assets, citing Kiev’s “legitimate claims” on these funds, following Russia’s invasion.

President Volodymyr Zelenskyy said Ukraine knew how to use Russia’s frozen assets. He proposed transferring the entire $300 billion to Kiev. “Frankly, these are Ukrainian funds,” he said.

According to World Bank estimates, by the end of 2023, Ukraine’s total economic, social and financial losses due to the war will amount to $499 billion.

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