The speaker of the House of Representatives, Hon. Abbas Tajudeen, has assured the various youth groups in the country that their input will be considered in the review of the proposed tax reform bills ahead of their passage by the legislature.
Abbas gave the assurance at the National Youth Dialogue on Tax Reform Bills held at the instance of the House Committee on Youths in Parliament in Abuja yesterday.
Represented by Hon. Leke Abejide (ADC, Kogi), the speaker described the bills as catalysts for economic growth and national progress.
“These bills will prepare the country to be economically viable, technologically independent of other nations,” he said.
On his part, the committee’s chairman, Hon. Ayodeji Alao-Akala said the review of the country’s tax laws had become necessary to address present challenges in fiscal policies.
Alao-Akala noted that young Nigerians, particularly those engaged in micro, small, and medium enterprises (MSMEs) were among the most affected by taxation policies.
He stated that most low-income earners in the country were youths, struggling to start businesses, rent homes or make financial progress.
The lawmakers said the proposed tax reforms aim to ease such burdens by ensuring fairer policies that support entrepreneurship and economic independence.
In its submission, the Alumni Association of the Legislative Mentorship Initiative lauded the Federal Government’s proposed legislation, saying that if implemented, the reforms would change the nation’s economic narrative.
“This proposed legislation is not merely a collection of fiscal policies; it is a blueprint that will shape the economic trajectory of our nation and more importantly, directly impact the lives of our youth, who largely represent the present and future of Nigeria,” representative of the association, Abubakar Tijani said.
He called for a balanced exchange of views, adding that as good as the bills were, there were areas of uncertainty that needed some clarity for the benefit of Nigerians.
“As we engage in this critical discourse, we must approach the subject with a balanced perspective, acknowledging the bill’s potential benefits while also addressing its areas of concern. Our collective goal must be to ensure that this legislation fosters inclusive growth, empowers our citizens, and lays a solid foundation for sustainable development,” Tijani added.
He identified the positives of the tax reform proposals to include company income tax reduction, support for small businesses, personal income tax relief and VAT exemptions on essential goods and services, among others.
While pointing out grey areas which require legislative intervention given the nation’s fragile economy, Tijani said: “The bill proposes a gradual increase in the VAT rate, starting from the current 7.5 per cent to 10 per cent in 2025, 12.5 per cent in 2026, and 15 per cent by 2030.
“While this measure is intended to boost government revenue, it could have adverse effects on consumers. An increase in VAT often leads to higher prices for goods and services, which could erode purchasing power and exacerbate inflationary pressures
“For the youth, who are already grappling with high unemployment rates, this could further strain their financial circumstances. It is essential to consider the broader implications of this policy on the cost of living and economic stability.
“Another concerning provision is the plan to cease funding for critical agencies such as the Tertiary Education Trust Fund, National Agency for Science and Engineering Infrastructure, National Information Technology Development Agency by 2030.”
For its part, the Centre for African Policy Research Advisory, advocated the involvement of Nigerians in the implementation of the bills when they are eventually passed into law.
Speaking on behalf of the Centre, Segun Adebayo emphasised the need for the protection of the nation’s tax sovereignty.
“Tax sovereignty refers to a nation-state’s right to control its tax policies. It is closely tied to a country’s ability to govern effectively and democratically,” he said.
Also speaking, the Project Sprint, said the bills have the potential to reduce the budget deficit, decrease government dependence on borrowing, curtail tensions across socioeconomic strata, and attract foreign investments.
The group’s coordinator, Israel James, pointed out areas of concern in the proposed reforms in his speech, saying, “One critical aspect to consider is the microeconomic implications of personal income tax on labour supply.”
“Many youths in Nigeria fall within the wage bracket of 70,000 to 150,000 naira per month. Taxing this demographic could have detrimental effects, especially for those on the verge of paying off academic loans and starting their lives.
“As we navigate the modern era, it is crucial to recognise that services such as telecommunications and digital transactions are essential. To disregard these services as non-essential would be a step backwards in our progress.
“We advocate for a reduction in VAT to between 3.5 per cent and 5 per cent to better reflect our GDP per capita. While encouraging states to compete economically to improve their VAT collection is commendable, it is equally important for the Federal Government to empower states to effectively manage their economies,” he added.
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