A new tax regime anchored on the Tax Reform Bills, awaiting Presidential assent, will go into effect in January, it has been learnt.

The six-month window is to allow for sensitization of Nigerians after President Bola Ahmed Tinubu might have signed the harmonized version of the bills, marking a significant step in the government?s ambitious drive to overhaul the tax system.

A sources said apart from sensitizing the public, the period between the Presidential assent and end of the year, will be used to make adequate preparation for the implementation of the law.

It was also learnt that the Presidency has received clean copy of the passed bill following then transmission from the National Assembly.

They are currently being scrutinize by the Presidency ahead of the Presidential assent.

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

Minister of Finance and Coordinating Minister of the Economy, Mr. Wale Edun, yesterday confirmed the transmission of the passed bills from the National Assembly to the Presidency at a lecture in Abuja organized to mark the 50th birthday of Mr. Taiwo Oyedele, Chairman of the Presidential Committee on Fiscal Policy and Tax Reforms.

?It was, I think, yesterday that it was finally delivered to Mr. President by the National Assembly for him to sign off on the four tax reform bills,? Edun said, describing the moment as a critical milestone in the Tinubu administration?s reform agenda.

The minister said the bills, once signed into law, are expected to significantly improve the efficiency and fairness of Nigeria?s tax system, while nearly doubling the country?s tax-to-GDP ratio, which remains among the lowest globally.

?There is still hard work to be done in efficiently implementing the bills that have been passed. But they promise to change the fiscal landscape,? the minister said.

Praising President Tinubu?s persistence in pushing the tax reform process through challenging times, Edun stated: ?Mr. President knew the value of those four tax reform bills and kept going through thick and thin, through turbulence and through wind. He just kept going, supporting you,? he said, referring to Oyedele.

According to him, the fiscal reforms championed by the Committee are central to Tinubu?s goal of lifting millions of Nigerians out of poverty.

He listed agriculture, infrastructure (including digital infrastructure) and access to finance as strategic sectors targeted for inclusive growth.

The minister credited Oyedele?s expertise and communication skills for making the reforms broadly accessible.

He said: ?You had the grace, the gift of being able to take a complex subject, and time after time, tirelessly break it down and simplify it for all types of audiences?the high, the low, the knowledgeable, the less knowledgeable.? ?And that?s why we have today success in terms of a proposal for proposed bills that are now ready for Mr. President to sign into law.?

According to him, the reforms will introduce a fairer, more transparent tax system aligned with global best practices.

?They will give greater fairness. They will give clarity. They will give ease of administration, best practice around the world. And ultimately? they?ll give more revenue for government so that the legitimate demands of our people can be met in social services, health, education, and basic infrastructure,? he said.

Referencing Oyedele?s impact on public attitudes toward taxation, Edun said: ?You went out and you saw and heard from people that they didn?t feel they were in any way obliged to pay tax. You have worked tirelessly to help change people?s perspective on that.?

He added that voluntary compliance plays a crucial role in the effectiveness of tax policies.

Oyedele offered a critical assessment of the country?s economic environment, stating that regulatory bottlenecks and tariff burdens were equivalent to granting tax waivers to a few, while discouraging investment and productivity.

The tax expert said: ?Addressing our tariffs and regulatory hurdles is the equivalent of granting waiver from all income and consumption taxes. We also need fiscal reforms to complement a strong and stable Naira, such as payments of all taxes in naira.?

Oyedele, who stressed that the work of the committee was far from finished, called for a downward revision of corporate tax rates to attract new investments and stimulate economic expansion, warning that high tax rates, especially in an inflationary environment, amount to taxing capital instead of profit.

He said Nigeria must also resolve issues of regulatory overreach and embrace digitisation as part of its economic reform package.

?We must refine our tariff system to reduce the rates on raw materials and intermediate products, which currently are twice the average for sub-Saharan Africa,? Oyedele said.

Cautioning the elite to resist the temptation of simplistic solutions in public policy debates, Oyedele said: ?The elite must apply more intellectual rigour in policy debates, challenge long-held theoretical beliefs and question assumptions within context. We must avoid crowd-pleasing analysis because after the applause, the pain remains.?

On what the government should do, Oyedele suggested that public institutions should only carry out tasks that the private sector cannot do, and should do so efficiently, collecting the least amount of tax necessary to meet basic public service standards.

He also spoke to the need for quality, non-inflationary spending by government, urging greater prudence and planning in fiscal policy implementation. According to him, ordinary Nigerians must also rise to the responsibility of civic participation.

The President, whose assent to the bills will formally launch a new chapter in Nigeria?s tax administration, felicitated Oyedele on his birthday.

In a statement by his Special Adviser on Information and Strategy, Bayo Onanuga, the President described ?an accomplished tax expert, accountant, and economist who exemplifies excellence, resilience, and innovation in public and private service.?

The President highlighted Oyedele?s inspirational rise from modest beginnings in Ikaram Akoko, Ondo State, to global recognition, with academic laurels from prestigious institutions including the London School of Economics, Yale University and the Harvard Kennedy School.

?From his early years in Ikaram Akoko to his decades of leadership at PwC and his studies abroad, Mr. Oyedele has shown that merit, discipline, and integrity are the foundations of actual achievement,? the President said.

Recalling the mandate given to Oyedele and his team during the inauguration of the reform committee, Tinubu stated: ?When I inaugurated the Presidential Committee on Fiscal Policy and Tax Reforms on August 8, 2023, I tasked the committee under his chairmanship with a bold mission to reform Nigeria?s tax and fiscal landscape, raise our Tax-to-GDP ratio to 18% within three years, and make the business environment more attractive.?

The President expressed satisfaction with the progress made so far, noting, ?Although I am awaiting the harmonised four tax bills to append my signature, indications are that the reforms will enable us to reach our targeted tax-to-GDP ratio, which has already risen from 10% to over 13.5%.?

He also commended Oyedele, who previously served as Africa Tax Leader at PwC, for playing a pivotal role in steering Nigeria towards ?a fairer, simpler, and more growth-oriented tax system.? (The Nation)

Update news