Ohanaeze Ndigbo Backs Tinubu’s Tax Reforms, Calls for National Unity on Economic Restructuring

President Bola Ahmed Tinubu‘s plan to reform Nigeria’s tax laws got a boost on Sunday, with Ohanaeze Ndigbo, the apex socio- cultural organisation from the South-east joining the South-west, South-south and North-central parts of Nigeria to support the landmark bills expected to significantly alter the existing fiscal framework.

Wading into the debate on the much-talked-about proposed legislations, Ohanaeze Ndigbo, in a statement issued by the Secretary General of the body, Okechukwu Isiguzoro, noted that the bills represent a transformative opportunity for the rejuvenation of Small Medium Enterprises (SMEs) and the enhancement of the fortunes of Nigerian workers.

But the controversy over the four tax bills continued on Sunday, with former Vice President Atiku Abubukar, however urging federal lawmakers to prioritise equity and inclusivity in deliberations on the proposed legislations.

The presidential candidate of the Peoples Democratic Party (PDP) in the 2023 general elections emphasised that Nigerians are currently united in their demand for reforms that do not exacerbate the nation’s uneven development.

THISDAY learnt that federal lawmakers from the South-west, South-south and North-central were already in on the need to alter the current framework to serve the generality of Nigerians.

The bills have recently received mixed reactions from members of the public, as the gulf between the proponents and those opposed to the bills, especially the part dealing with the derivation formula in Value Added Tax (VAT) has widened.

Among key figures that have publicly spoken on the issue are the Deputy Senate President, Barau Jibril, who opined that those criticising the tax bills had not even read them.

However, the Governor of Borno State, Prof. Babagana Zulum, who had earlier raised the alarm that the tax bills will further pauperise the northern states, speaking during an interview on national television on Sunday, doubled down on his opposition to the proposed legislations.

In backing the federal government’s move, the Isiguzoro-led Ohanaeze Ndigbo added that by eliminating the scourge of double taxation imposed by state governors, the reforms would pave the way for an equitable business climate that significantly elevates both local and foreign investment potential.

“In an emphatic affirmation of progress and economic empowerment, Ohanaeze Ndigbo, the esteemed apex socio-cultural organisation representing the Igbo nation, hereby announces its steadfast endorsement of President Bola Ahmed Tinubu’s proposed tax reforms bills.

“This endorsement comes after rigorous reviews, exhaustive consultations with an array of stakeholders, and an in-depth analysis of the bills’ implications for the Nigerian economic landscape.

“Our comprehensive evaluation has led us to the resolute conclusion that these tax reforms are not merely legislative proposals; they represent a transformative opportunity for the rejuvenation of SMEs and the enhancement of the fortunes of Nigerian workers.

“By eliminating the scourge of double taxation imposed by unscrupulous state governors, these reforms will pave the way for an equitable business climate that significantly elevates both local and foreign investment potential.

“The Igbo people, renowned for our entrepreneurial spirit and unwavering commitment to economic self-determination, stand to gain immensely from these reforms,” Isiguzoro argued.

According to him, the proposed measures are expected to safeguard the private sector, particularly benefiting the ‘industrious Igbos’, who he said play a pivotal role in driving the Nigerian economy through vibrant SME activities.

The apex Igbo body further called on southern lawmakers in the National Assembly to unify their efforts in support of what it described as Tinubu’s transformative restructuring programme within Nigeria’s economic and fiscal sectors.

Ohanaeze Ndigbo emphasised: “It is disheartening to observe the substantial opposition that has emerged from certain factions within Northern Nigeria regarding these critical reforms.

“There is palpable concern that Northern governors are mobilising their forces to stifle the progression of the tax reforms bills within the National Assembly, relying on their numerical predominance to assert undue influence.

“This orchestrated opposition appears driven by a desire to perpetuate the current VAT derivation principles that unjustly favour select interests at the expense of equitable national growth.

“The implications of such manoeuvres are profound. If the Northern political elites succeed in thwarting President Tinubu’s initiatives, it could set a dangerous precedent, fostering a climate of resistance against meaningful reform.

“This scenario poses a tangible threat not only to the president’s agenda but also to the broader economic aspirations of millions of Nigerians who yearn for a reformed and equitable system.”

The body further urged all stakeholders, including lawmakers, business actors, and citizens to unite in support of these pivotal tax reforms bills.

But Atiku, while making his position known on the matter in a post on his official X handle, called for transparency in the entire process.

The four tax reform bills passed second reading at the Senate last Thursday and were referred to the Senate Committee on Finance chaired by the Senator representing Niger-east, Sani Musa, for further legislative action, including a possible public hearing.

Besides, Senate President, Godswill Akpabio, directed the committee to involve the National Economic Council (NEC), Nigerian Governors’ Forum (NGF) and Civil Society Organisation (CSOs) in the proposed public hearing.

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

Appearing to be cautious in his comments, Atiku who said that due process should be followed, noted that the proposed public hearing on the tax reform bills must facilitate an open and inclusive conversation by all concerned stakeholders.

“Nigerians are united in their call for a fiscal system that promotes justice, fairness, and equity. They are loud and clear that the fiscal system we seek to promote must not exacerbate the uneven development of the federating units by enhancing the status of a few states while unduly penalising others”, the former vice president stated.

However, proponents of the new tax bills have said that the majority of those criticising the bills have not read their provisions and are only amplifying ‘falsehoods’ circulated by uninformed interest groups.

Atiku added: “I have followed the intense public discourse on the tax reform bills with keen interest. I call for objectivity and transparency in the conduct of the public hearing being organised by our representatives in the National Assembly.

“As a concerned stakeholder, I firmly believe that transparency and objectivity are essential for promoting accountability, good governance, and public trust in policy-making.

“The public hearing process must facilitate open and inclusive participation by all stakeholders, including civil society organisations, traditional institutions, politicians, public officials, and subject matter experts.”

The former vice president further urged the National Assembly to publicise the resolutions of the National Economic Council (NEC) on the bills.

“In this wise, I call on the National Assembly to revisit and make public the resolutions of the National Economic Council, a key stakeholder and an important organ of the state with the constitutional power to advise the president concerning the economic affairs of the federation.

“The National Assembly must be appropriately guided and ensure that in the final analysis, the contents of the bills align with the interests of the vast majority of Nigerians,” he noted.

The two chambers are expected to organise separate or joint public hearings on the bills. No date has been announced for the public hearing. Besides, after the public hearing, the committees will present the resolutions and recommendations to the Senate and the House for approval.

The lawmakers will then make a final decision on the bills at the ‘Committee of the Whole’ where the clauses of the bills will be debated and considered.

However, Zulum, while explaining why he, along with some northern governors, advised Tinubu to withdraw the tax reform bills, insisted that more time was needed for consultation, admitting that there were a lot of misconceptions about the proposed law.

“On this tax issue, there are a lot of misconceptions. We felt that the VAT provision in the tax law based on the calculations that we did, only Lagos and Rivers States will benefit from this scheme. We did our own research and concluded that we would lose.

“Why are we in a rush? We advised the federal government to take a pause, and expunge some of the clauses that are inimical to not only Northern Nigeria. What we are saying is that give more time, let us do a deeper consultation to understand the nitty-gritty of this tax regime before passing it into law,” he argued.

The governor maintained that if the bills scale through the National Assembly, states would be short-changed, stressing that only Lagos State and Rivers would be the main beneficiary of the policy.

Zulum argued that contrary to insinuations in some quarters, the northern governors were not against Tinubu’s administration, regretting that some people were passing a negative narrative that the north was opposed to the current government.

He also contended that if the bills become law, the Tertiary Education Trust Fund (TETFund), the National Agency for Science and Engineering Infrastructure (NASENI) and National Information Technology Development Agency (NITDA) will all cease to exist by 2029.

Besides, he expressed reservations about some of the provisions of the bills, including the status of the Federal Inland Revenue Service (FIRS) as the sole tax collection agency in Nigeria.

But contrary to the views expressed by the apex Igbo body, the Coalition of Northern Groups (CNG), has expressed fears that the proposed changes could disproportionately favour more economically advanced states, leaving Northern states, including Gombe, at a disadvantaged economic position.

The assertion was made by the Gombe State chapter of the CNG, citing concerns over potential economic disparities and regional inequalities. It therefore strongly rejected the bill.

In a press statement issued on Sunday through the chapter’s Coordinator, Muhammad Deba, the group highlighted key issues that could arise from the bill, particularly its provisions on VAT reforms.

While raising concerns over regional disparities, the CNG stated that its opposition stems from the bill’s proposed VAT sharing formula, which places greater emphasis on derivation—allocating VAT revenues based on the state where the revenue is generated.

The CNG argued that this would significantly benefit states like Lagos, which generate substantial VAT revenues, while northern states with lower economic activities would face reduced revenue shares.

“This reform threatens to widen the economic gap between the North and South. It could lead to increased social unrest, migration, and further marginalisation of northern states. This is not the path to national unity or economic stability,” the group stated.

While demanding transparency and fairness, the CNG criticised the lack of openness in the decision-making process, emphasising that no comprehensive data or analysis has been provided to justify the changes.

According to the coordinator, without clear evidence and transparent decision-making, it is impossible to accurately assess the potential negative impacts of the reform.

“We cannot allow policies to be implemented without a thorough understanding of their implications. The government must ensure that any tax reform is fair and equitable for all states,” Deba added.

In the statement, the CNG outlined three key demands including transparent and equitable revenue sharing, stressing that the government must ensure fairness in revenue allocation to prevent further marginalisation of economically weaker states.

It stated that clear data and analysis must be presented to justify the proposed changes to the VAT formula, adding that there should be consultative approach and that the government should engage with civil society organisations, experts, and other stakeholders to ensure the tax reform aligns with the needs of all Nigerians.

It urged the Nigerian Senate to suspend further consideration of the tax reform bills until existing concerns were addressed, calling on all Nigerians to advocate for a tax system that promotes national unity and economic prosperity.

Chuks Okocha, Emmanuel Addeh, Benjamin Nworie and Segun Awofadeji

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