On Tuesday, the House of Representatives passed the four tax bills transmitted by President Bola Tinubu in October 2024. The bills, which have been under deliberation for several months, were finally passed on their third reading. This marks a significant step toward reforming Nigeria’s tax administration system.
Approval Process and Timeline
The House had previously considered and approved the report of the House Committee on Finance last Thursday. This report included several recommendations regarding the executive bills. After a delay of about three months, which involved public hearings and the receipt of memoranda from stakeholders, the National Assembly resumed work on the bills three weeks ago. These hearings focused on how best to reform Nigeria’s tax system to improve efficiency and transparency.
Final Readings of the Bills
During Tuesday’s plenary session, House Leader Julius Ihonvbere moved for the bills to be read for the third and final time. He addressed the House, stating, “Mr. Speaker and honourable colleagues, I move that the bill for an Act to provide for the assessment, collection of, and accounting for revenue accruing to the federation, federal, states, and local governments, prescribing the powers and functions of tax authorities, and for related matters be read for the third time.”
Ihonvbere also moved for additional bills to be read for the third time, including one to repeal the Federal Inland Revenue Service (Establishment) Act, No. 13, 2007, and replace it with the Nigeria Revenue Service (Establishment) Bill. This bill would establish the Nigeria Revenue Service, empowering it to assess, collect, and account for government revenues. Another bill, aimed at establishing the Joint Revenue Board, the Tax Appeal Tribunal, and the Office of the Tax Ombudsman, was also presented for third reading. These bodies will be responsible for coordinating and resolving disputes related to Nigeria’s revenue administration.
Lastly, a bill to repeal certain outdated taxation acts and consolidate the legal frameworks governing taxation into the Nigeria Tax Act was also moved for third reading. This new act would cover the taxation of income, transactions, and instruments.
Overwhelming Support and Some Opposition
The bills were passed overwhelmingly by lawmakers during the session, with Speaker Tajudeen Abbas presiding. The next step is for the bills to be forwarded to President Tinubu for assent after passing through the Senate. If necessary, harmonization between the Senate and House versions will take place before the bills are sent to the President.
Despite the strong support, there was some opposition, particularly from lawmakers representing northern Nigeria. These lawmakers, in solidarity with their governors, called for the bills to be withdrawn for further consultations. This opposition has highlighted concerns regarding the potential impact of the bills on local governance and regional interests. However, the bills’ passage represents a major move toward strengthening Nigeria’s tax framework.
